What are the CAFE rules India's auto industry is discussing?

CAFE rules set Corporate Average Fuel Efficiency standards to improve vehicle fuel economy and reduce emissions.

Why is the Indian auto industry divided over small car concessions?

Some automakers, like Maruti Suzuki, want relaxations for small cars, while others argue against special treatment.

When will the new CAFE 3 norms be implemented in India?

The new CAFE 3 norms are scheduled to be implemented starting April 2027.

Home / Business and Economy / India's Auto Industry Battles Tighter Fuel Rules

India's Auto Industry Battles Tighter Fuel Rules

18 Dec

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Summary

Carmakers urge government to relax fuel efficiency targets and boost EV incentives.
Industry split over proposed concessions for small cars, favoring Maruti Suzuki.
Stricter CAFE norms aim for significant fuel efficiency improvements by 2032.

India's Auto Industry Battles Tighter Fuel Rules

India's automotive sector is actively engaging with the government to influence upcoming fuel efficiency regulations and EV incentives. Carmakers are seeking a relaxation of the stringent Corporate Average Fuel Efficiency (CAFE) rules, which include ambitious annual improvement milestones and revised incentives for various powertrains. These negotiations could significantly shape the country's vehicle landscape for the next decade.

A key point of contention is the proposed "super-credit" system for zero-emission vehicles and the feasibility of the annual fuel efficiency targets. The industry argues these goals are too steep. Furthermore, a division exists regarding concessions for small cars, with Maruti Suzuki advocating for them while other manufacturers resist special treatment.