The government is expected to finalize the guidelines of the Corporate Average Fuel Economy (CAFE) 3 regulations within the next one to two months, offering long-awaited clarity to automakers as they prepare the future powertrain roadmap, according to a senior executive at Maruti Suzuki.
Rahul Bharti, Senior Executive Officer, Corporate Affairs, Maruti Suzuki said, “The discussions have been proceeding well between industry and government. Both sides understand each other’s position quite well.” “It is expected that within one to two months, final regulation will be out so that we have clarity for the powertrain,” he added.
While Bharti didn’t share specific changes, saying Society of Indian Automobile Manufactures (SIAM) is the official spokesperson, his comments suggest cautious optimism that the new rules will balance environmental goals with what’s practical on the ground.
The Ministry of Power’s Bureau of Energy Efficiency (BEE) has fixed an emission target of 91.7 grams of carbon dioxide per kilometre for passenger vehicle makers under the upcoming CAFE 3 norms, set to take effect from April 1, 2027.
The final CAFE norms are expected to significantly influence carmakers’ product strategies, investment decisions, and technology choices in the years ahead.
According to multiple reports, Maruti Suzuki had raised concerns that stringent fuel efficiency targets could adversely impact small cars, a highly price-sensitive segment and had suggested a relaxation of norms specifically for these vehicles, a move that was opposed by other carmakers.
“In CAFE norms, a multi-powertrain approach or a strategy is a much de-risked one. We are ambitious on EVs and we are ambitious on other clean technologies also,” Bharti said.
Challenges pertaining to lithium-ion and other critical minerals remain and hence CAFE norms are a better alternative toward sustainability, according to Bharti.
Bharti said the government is aware of the issue and is taking a pragmatic approach. “Inter-ministerial discussions are underway, and there’s growing consensus on the matter. As a result, adopting a multi-powertrain strategy under the CAFE norms is seen as a more de-risked and practical path forward,” he said.
The current CAFE II norms permit automakers to emit up to 113.1 grams of carbon dioxide per kilometre. These norms are designed to tighten fuel efficiency standards across vehicle manufacturers, effectively pushing the industry toward electrification and other cleaner technologies.