India's Next Phase Of Corporate Average Fuel Efficiency Norms Set For 2027 Rollout, Proposal Sent To PMO

New Delhi: The power ministry has sent the proposal on the Corporate Average Fuel Efficiency (CAFE)-III norms to the Prime Minister's Office after a meeting with stakeholders, Union Heavy Industries Minister H D Kumaraswamy said on Wednesday, even as the auto industry appears to be divided over the treatment of small cars and changes in technical definitions.

On differences among auto industry stakeholders on the CAFE-III norms, Kumarswamy told reporters, "We already had a meeting with stakeholders and the power ministry. The power ministry, according to my information, now, after the meeting with stakeholders, they have sent the proposal to PMO."

No leniency must be granted to small cars in the corporate average fuel efficiency (CAFE-III) norms on the basis of weight and affordability, as it would compromise safety features while distracting from concrete action towards sustainable mobility, Tata Motors Passenger Vehicles Ltd Managing Director & CEO Shailesh Chandra had said in November.

However, market leader Maruti Suzuki India has been vocal in proposing such a concession for small cars, and its Chairman R C Bhargava had argued that the idea behind CAFE norms was to make big cars improve fuel efficiency and reduce emissions.

The CAFE norms, started from 2017, set a limit on average fuel consumption and CO2 emissions of a manufacturer's overall fleet with an aim to push carmakers to improve their overall fuel efficiency and reduce emissions.

The CAFE-II began in 2022, and the next phase, CAFE-III, is likely to start from April 2027, for which new criteria are under discussion between various stakeholders with the Bureau of Energy Efficiency (BEE) under the power ministry releasing a draft regulation in September this year for feedback.

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