Automakers warn CAFE III norms could favour one OEM, question new weight-based rules

Several carmakers have written to the Minister for Heavy Industries, saying the proposed Corporate Average Fuel Efficiency (CAFE) III norms would end up benefiting a single OEM, industry sources told CNBC-TV18.They said the plan to introduce a new vehicle sub-category based on weight could hurt India’s progress toward cleaner and safer cars. They also pointed out that vehicle weight has risen because of safety regulations.
CAFE III norms are the next phase of India’s fuel-efficiency standards for passenger vehicles. They set targets for the average CO₂ emissions produced by each automaker’s entire fleet rather than individual models.
The aim is to push carmakers toward lower-emission technologies, improved engines, and better overall efficiency. CAFE III proposes updated limits, new compliance methods, and possible weight-based categories that influence the calculation of these emission targets.The OEMs stated that emission-norm relaxations should not be given to cars weighing up to 909 kg, with engine capacity up to 1200 cc and length under 4000 mm.

They highlighted that Maruti Suzuki has more than a 95% share of the market for cars up to 909 kg.

They said that if any CO₂ concessions are considered, they should apply to all cars up to 1170 kg, which they described as the current industry average.

The companies argued that granting CO₂ reduction credits to internal-combustion vehicles based only on weight, and without actual CO₂-cutting steps, would conflict with the purpose of Corporate Average Fuel Efficiency rules.

They added that GST rules already classify small cars as those with engines below 1200 cc, and said creating a new small-car sub-category under CAFE norms could affect long-term investment plans for manufacturing and supply chains.