Amid lobbying, government may delay auto fuel efficiency standards

NEW DELHI: The government may eventually delay the implementation of the Corporate Average Fuel Efficiency Norm (CAFE 3.0) beyond April 2027, following lobbying by automobile companies. The Prime Minister’s Office has held two meetings in the past three weeks and plans more deliberations on the issue to come up with a formula that the industry can accept and help improve fuel efficiency and emissions.At a project office meeting on Monday, the power ministry gave details of the proposed CAFE 3.0 norms while underlining the “urgency” of notifying the norms. For the first time, the ministry has conducted a detailed assessment of the expected performance of the country’s top five automakers. It said that under the proposed framework, which will be released for public comment, only Tata Motors will be able to achieve the target between 2027-28 and 2031-32, while Maruti Suzuki and Hyundai Motor India may not make the cut.The demonstration showed that Toyota Kirloskar will be able to achieve its targets in the first three years (2027-28 to 2029-30), while Mahindra will not be able to achieve its targets in the first three years. “It appears that the proposed system will ultimately impose heavy fines on companies that fail to meet the target,” an official said.The CAFE 3.0 specification proposes to remove derogations (additional subsidies) or exemptions for small car manufacturers while seeking to introduce range-extended electric vehicles (REEVs) with the same volume derogation factor (VDF) of 3 as electric vehicles. The VDF is a targeted government measure aimed at boosting sales of less polluting vehicles such as electric vehicles, REEVs and hybrids.“As things stand, it may take at least a few months to notify the norms. It will take the industry at least a year to implement this,” a person familiar with the matter said.