The auto sector is undergoing a critical period of evaluation, with the industry body SIAM announcing it is thoroughly reviewing the draft Corporate Average Fuel Efficiency (CAFE-III) norms. SIAM confirmed that it will discuss the draft with its members to finalize a consensus regarding the implementation timeline.
During a press conference in New Delhi on Tuesday, SIAM President Shailesh Chandra highlighted the continuing complexities within the industry. Chandra stated that the body is working to finalize its view on the timeline, anticipating a constructive meeting with the Bureau of Energy Efficiency (BEE) in the coming days.
Conflict Persists Over Small Car Incentives in CAFE-III
A major point of contention remains the inclusion of incentives for small cars within the CAFE-III norms. When questioned, Chandra declined to comment on specific incentives, noting that the topic has generated mixed views among manufacturers.This division is evident in the industry structure. While manufacturers like Maruti Suzuki and Toyota Kirloskar advocate for granting benefits to small cars based on weight and affordability, others are strongly opposed.
Large OEMs, including Tata Motors, Mahindra, Hyundai, and Kia, are pushing back against differential treatment. They argue that such leniency could potentially compromise established safety features across vehicles.
Industry Readiness and the 2027 Deadline
The question of compliance by the stipulated deadline remains central to the discussion. On Monday, Additional Secretary Hanif Qureshi had indicated that automobile manufacturers must adhere to stricter fuel efficiency standards from April 1 next year, suggesting the government is unlikely to extend the CAFE-III deadline.Regarding this timeline, Chandra stated that the industry is currently focused on finalizing its collective review and assessing the readiness of all Original Equipment Manufacturers (OEMs). He stressed that the final position would only be taken after the forthcoming meeting with the BEE.
SIAM Advocates for Enabling Environment over Mandates in EV Policy
Beyond fuel efficiency, the auto industry is addressing evolving electrification regulations. When asked about the Delhi EV policy, which proposes mandating two-wheelers and banning certain older vehicle registrations, Chandra offered a distinct viewpoint.SIAM's core view, he asserted, should focus on creating a broader "enabling environment" for the adoption of electric vehicles. This approach, he explained, requires removing barriers through incentives rather than relying solely on strict governmental mandates.
Chandra elaborated that achieving this enabling environment means overcoming challenges like charging infrastructure. He believes that by providing the right incentives, a "natural pull" will emerge among consumers, lessening the need for regulatory mandates.
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