New Delhi: Auto manufacturers have a responsibility– while our job is to protect the interest of our company and prioritize whatever our company’s priorities are, my sincere request to OEMs is to not go to such an extent, to exaggerate the benefit of your technology in such a way that it becomes unbelievable, Rajeev Chaba, Chairman Emeritus, MG Motor India, said.
Chaba was speaking at an industry conference organized by SIAM (Society of Indian Automobile Manufacturers) on the occasion of the World Environment Day on Wednesday.
“Talking about a certain technology that gives you huge fuel efficiency is essentially a great thing. But if you say that hybrid technology is also EV (electric vehicle) technology which 60% of the time you can run as an EV with a battery of less than two kWh, that is a stretch! Then you are exaggerating your technology at the cost of some other technology,” Chaba said.
“You talk about hybrids and fuel efficiency but don’t say it’s an EV. Do not ridicule the other technology which is technically good,” he added.
In the transition from ICE to EVs, passenger vehicle OEMs are offering multiple powertrain options including petrol, diesel, CNG, hybrids, EVs, and flex fuels. Currently, EVs get the benefit of 5% GST, while the tax on other vehicles varies between 29% (for small cars) and 43% (for cars above 4 metres).
India’s largest carmaker in volumes Maruti Suzuki, which offers the strong hybrid technology, earlier stated that the technology offers “unmatched fuel-efficiency and significantly lower carbon emissions.” It has “the ability to be 60% on EV mode under city driving conditions”.
The maker of Grand Vitara and Invicto plans to introduce EVs in the first quarter of next year. It has suggested that hybrids should be encouraged like EVs to cut down emissions and improve energy efficiency.
Earlier, automakers including Mahindra & Mahindra and Tata Motors also argued that hybrids are not zero emission vehicles like EVs– they are only a technology which makes ICE vehicles more fuel efficient.
Chaba said that it could be a tough call for policymakers. We should look at making policies from the country’s perspective– whichever technology reduces import bills, can be localized, protects the TCO (total cost of ownership) for consumers, is environmentally conscious, and contributes to a stable supply chain.
He is of the view that once a clear roadmap is defined on the policy front, it will provide stability for the long term vision of the entire ecosystem. “There should not be a scare every year to second guess the government policy, while the headquarters keep blaming the local units that they don’t know what’s happening in the country.”
According to him, policy intervention for fuel technology in terms of GST should be decided based on three factors– size of the car, fuel efficiency and emissions.
He further added that unlike many other countries, the Indian automobile industry is very complicated as there isn’t a single federal decision maker but too many ministries to deliberate. “It requires leadership.”
Meanwhile, Chaba praised Maruti Suzuki and Hyundai for cracking the domestic market. “To be a leader in the country for 30-40 years and still hold on to that position is not easy. You must be doing something right. Hyundai has also understood the market. They have stepped up and they know what to do. Other players like Kia and Toyota, the alliance partners for Maruti and Hyundai have got the benefits of synergy and they are also doing well.”
“Apart from that, no one has been successful, including MG Motor India. We may be selling some volumes but we didn’t crack the Indian market,” Chaba said.
