May have to discontinue small cars if CAFE targets unjust: Maruti

Maruti Suzuki warns that unworkable CAFE-3 emission targets could force small, low-emission cars off the road, urging realistic norms and pushing back against industry claims on safety and exemptions

Cars weighing less than 909kg would have to be discontinued if the carbon dioxide emissions target under upcoming CAFE-3 norms are “unscientific and unjust”, Rahul Bharti, senior executive officer (Corporate Affairs), Maruti Suzuki India (MSIL), said on Monday.

 

The CAFE (corporate average fuel efficiency) framework sets average carbon-dioxide (CO2) emission targets that each automaker’s fleet must meet, measured in grams per kilometre (g/km). If a company fails to meet its target, the Bureau of Energy Efficiency (BEE) can impose stiff penalties.

 

“First of all, this benefit of 3 g/km (for cars weighing less than 909 kg) is a very small number. The incentives to other segments (electric vehicles, strong hybrids, etc) in CAFE-3, based on so many considerations, are far higher in magnitude. So, it is a minuscule benefit even by global standards. For example, Europe gives an 18 gram relaxation (to small cars),” Bharti said during a video press conference on Monday.

 

“The risk is that if the targets become unscientific and unjust, Then, just to meet CAFE-3 regulation, a small car -- which produces a very low absolute carbon dioxide -- will have to be discontinued. That, we don’t want,” he added.

 

“So, this is why we want to keep the targets realistic. Tough but realistic, with some stretch, of course. But they should not be globally unachievable,” Bharti said.

 

On allegations from other companies such as Tata Motors Passenger Vehicles that a weight-based exemption to small cars under CAFE-3 would go against India’s gradual movement towards safer cars, he said: “All small cars in India follow the same crash test regulations as the big cars. And these were exactly the same as what they were in Europe until 2022. So, these are certified safe cars. On top of this regulation, Maruti Suzuki provides six airbags as standard across all variants in its models, and not just the top variants. We don’t differentiate between the life of a richer customer or the customer buying a not-so-expensive car,” he mentioned.

 

“However, many companies in India are not doing that. They are saving money on the lower variants. They are putting airbags in top few variants and not providing them in the lower variants. So, if there may be a cause of concern in those models, there might be. We are not experts on their models. At least, our cars are very safe,” he added.

 

“I should also tell you that these cars are being exported to over 100 countries in the world. Don’t tell us that the whole world is buying unsafe cars. So, that makes small cars absolutely safe,” he mentioned.

 

People are ignoring the high number of fatalities that are being recorded among people driving two-wheelers, he said.  “Some incorrect facts and narratives are being pushed in a very irresponsible manner by the makers of some large gas guzzlers to take away attention from their large gas-guzzlers,” he stated.

 

“Two wheelers have about 45 per cent of India’s total crash fatalities. And, cars have over a period of time, tapered down from 18 per cent to 12 per cent of fatalities. So, we are equally and more concerned about the fatalities on either two wheelers or cyclists and pedestrians. Just because we have a large heavy SUV, we should not trample them down. That is also a concern...We should help two-wheeler owners move to cars as early in their lives as possible,” Bharti added.

 

He said that many companies were spreading a wrong narrative that the small car is not being purchased as entry customers are directly buying expensive SUVs, and therefore, the small car segment did not need any support. “If the large cars and SUVs were growing anyway at high rates and the entry customers were also buying expensive cars, then the industry before GST should have been growing 20 per cent plus. But it was stagnant at nearly zero per cent,” he stated.

 

The BEE had in June 2024 released its first draft of CAFE-3 norms, which would apply between 2027-28 (FY28) and 2031-32 (FY32). Earlier this year, MSIL -- India’s largest carmaker and the biggest small-car seller -- approached the BEE requesting relief for small cars through a weight-based exemption. This move sharply divided the industry.

 

On September 25 this year, the BEE issued a revised draft incorporating the weight-based exemption for the first time. As per the revised draft, petrol vehicles weighing up to 909 kg, with engine capacity below 1,200 cc and length under 4,000 mm, will receive an additional 3 g/km deduction in their declared carbon dioxide emissions.