Maruti Suzuki, India’s largest carmaker and Mahindra seek to bump the share of electric vehicles (EVs) to nearly a fifth of their sales in the coming years from below 5% in the year ended March 2025, according to plans disclosed by companies. Tata Motors, with a third of its sales coming from CNG and electric cars last fiscal, is relatively better placed than peers to meet the Corporate Average Fuel Efficiency (CAFE) 3 norms.
The target will be relatively tougher to meet for Mahindra and Hyundai, whose portfolios are dominated by big sports utility vehicles (SUVs), according to a Goldman Sachs report. Tata Motors will be able to meet emission norms cap, it said.
The Bureau of Energy Efficiency’s (BEE’s) draft CAFE 3 norms, released on 25 September, mandate carmakers to gradually cut the average fuel consumption of the cars they sell from 3.73 litres per 100km in 2027 to 3.01 litres by 2032. Since the rules look at an average of the fuel consumption and tailpipe emissions across vehicles sold, companies benefit from selling more clean-fuel cars like EVs, CNG and hybrids.
Hyundai Motor India is looking to gain market leadership in EVs through new launches by 2030, when it expects EVs to reach 15-17% penetration in electric four-wheelers. However, the maker of the Creta SUV has not given a specific target for how much share clean-fuel cars will account for in its portfolio.
“EVs will be a critical piece to solving the CAFE norms for us. Today, if you look at our numbers, we are already up to 8% EV penetration,” Nalinikanth Gollagunta, chief executive of the automotive division at the Mahindra Group, told reporters on Monday. “While it will be hard to predict exactly what it looks like, but if we are in the high-teens in terms of EV penetration, we should be in the shooting range of where CAFE-3 wants us to be.”
Mahindra, which makes the XEV 9e and BE 6 EVs, has the capacity to make 5,000 electric cars a month, which will be ramped up to 8,000 units in a few weeks, Gollagunta said. When the company starts producing vehicles on its modular SUV platform NU.IQ, that will give it an additional capacity of 20,000 units per month, which can be flexibly used for making EVs, he said.
Hyundai and Mahindra have to cut overall carbon emissions of their portfolios through clean fuel cars by 12% and 14%, respectively, by the financial year 2028 to comply with the CAFE 3 norms, while Maruti has to cut down emissions by 7%, analysts at Goldman Sachs wrote in the 11 August note. The calculations did not account for relaxations for small cars, which will give an advantage to Maruti Suzuki.
Last week, Tata Motors’s leadership told analysts during a meeting that clean fuel cars were already a high percentage of its vehicle portfolio.
“In the mid-long term, expect CNG share to increase to 25-30%, 20% EV, 5% diesel and balance petrol,” analysts at Yes Securities wrote in a 29 September note, citing the management’s commentary on fuel mix.
The company will not need hybrid vehicles to meet its emission norms as it aims to scale EV sales to get over 50% market share in the segment, the management said. In financial year 2025, Tata Motors, which sells the Nexon and Curvv EVs, sold 64,249 electric cars in the country.
Mahindra, too, has said it won’t need hybrid cars to comply with any emission regulations.
However, Hyundai Motor India and Maruti Suzuki have both said they will sell several different powertrain options in India.
“The EV market will be 15-17% of the total industry volume by 2030. Hyundai has plans in place to have a higher market share than other players by 2030,” Hyundai India chief operations officer Tarun Garg said on 11 September, adding that the company will leverage all technologies including CNG, EVs and hybrids.
Hyundai plans to launch six EVs, including refreshes, in the next four years, along with the introduction of a hybrid vehicle.
Maruti Suzuki’s annual report said the company wants to target 15% EVs, 35% CNG vehicles and 25% hybrid vehicles as part of its clean portfolio. The maker of the Swift Dzire will receive special relaxations under the proposed emission norms as small cars will automatically get a reduction for carbon emission calculation.
“In CAFE norms, a multi-power train approach or a strategy is a much de-risked one. We are ambitious on EVs, and we are also ambitious on other clean technologies also,” Rahul Bharti, senior executive director, corporate affairs, Maruti Suzuki, said during the company’s earnings call on 31 July.
Companies will report their emission numbers to the BEE, the nodal agency to monitor and penalize carmakers for not meeting emission norms.
#Carmakers #chalk #plans #comply #stricter #fuel #efficiency #norms
