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Old 3rd April 2017, 11:37   #1
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Default No FAME subsidy for mild hybrids from April 1, 2017

The Government of India has withdrawn subsidies given to mild hybrid vehicles under the FAME (faster adoption and manufacturing of hybrid and electric vehicles) scheme. This change has come into effect from the start of this fiscal (April 1, 2017).

The FAME initiative was announced in April 2015, as part of the government's aim to promote the sales and use of eco-friendly vehicles in the country. Under this scheme, mild hybrids, full hybrids, plug-in hybrids and pure electric vehicles were awarded subsidies of up to Rs. 1.38 lakh for cars and Rs. 29,000 for bikes. However, post April 1, mild hybrids will not be able to take advantage of the scheme.

Maruti Suzuki will undoubtedly be the most affected automaker from the withdrawal of the subsidy. The company currently offers its mild hybrid system (SHVS) on the diesel versions of the Ciaz and Ertiga. Till now, both these cars benefitted from incentives worth Rs. 13,000 under the FAME initiative.

A mild hybrid vehicle generally comes with an automatic start-stop system that cuts off the engine when the car comes to a standstill and does not move for a considerable time period. The engine comes to life when the driver presses the accelerator pedal. Such vehicles are also equipped with a regenerative braking system that is capable of capturing the energy lost during braking and storing it in the car's battery. This stored energy is used to operate the starter motor when the car's auto start-stop system needs it. This entire process is said to enhance the car's fuel efficiency.

Source: PTI

No FAME subsidy for mild hybrids from April 1, 2017-maruticiaz01.jpg
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Last edited by dZired : 3rd April 2017 at 11:38.
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Old 3rd April 2017, 11:43   #2
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Two things, First,

1. How many cars are actually effected by this.
2. How much price difference with them would be now with this new rule ?

e.g Maruti Ciaz, Etriga with SHVS tech, or Mahindra Micro-Hybrid or Splendor iSmart and such.

Secondly,

Speculation about new Dzire with smart hybrid now can be ruled out, I guess.

I have already posted in other thread, car makers were taking this as a loophole to gain that benefit without a proper hybrid (electrical motor powering driven wheels), and this rule should push them for proper hybrid, that too for cost factor, localization !
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Old 3rd April 2017, 11:55   #3
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

So they finally decided to call a spade a spade, and stop giving incentives under FAME to the supposed "mild hybrids"!

Maruti Suzuki was the first to take full advantage of such a generous classification for "mild hybrids", soon followed by Mahindra. Others like Hyundai, Tata etc. were also rumoured to be developing their own "mild hybrids" to take advantage of FAME incentives. I wonder what'll happen to their plans.

I also wonder whether only the incentives under FAME have been withdrawn from the beginning of this fiscal. What about the lower excise rate (12.5% I guess) that these "mild hybrids" (of length > 4m) benefitted from? We'll have to wait for the GST rates, I suppose.

Here is how much incentive each category of passenger vehicle got under the FAME scheme:

No FAME subsidy for mild hybrids from April 1, 2017-screenshot_20170402203014.jpg

Note: All existing Maruti Suzuki & Mahindra "mild hybrids" fell into the category of Mild HEV (Conventional Battery).

Interestingly, Suzuki's SHVS available on international models would have been classified as Mild HEV (Advance Battery) (sic) as it has an additional lithium-ion battery.

However, Maruti Suzuki's SHVS available on Indian models did not come under the said category as this system lacks the aforementioned lithium-ion battery.

Last edited by RSR : 3rd April 2017 at 12:12.
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Old 3rd April 2017, 11:59   #4
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Should never have been available for mild hybrids in the first place.

Want benefits? Implement and offer a proper hybrid powertrain.
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Old 3rd April 2017, 12:00   #5
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

This affects the consumer in the short-term as certain cars that employ these mild hybrid technologies get costlier but I am very glad this step has been taken.

If the Govt. is indeed providing a subsidy, it better help the true hybrids such as Reva become more affordable.

What Maruti does with SHVS is absolute hogwash and defeats the true purpose of the subsidy.
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Old 3rd April 2017, 12:02   #6
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Quote:
Originally Posted by NaXal View Post
I have already posted in other thread, car makers were taking this as a loophole to gain that benefit without a proper hybrid (electrical motor powering driven wheels), and this rule should push them for proper hybrid, that too for cost factor, localization !
Quote:
Originally Posted by RSR View Post
So they finally decided to call a spade a spade, and stop incentives under FAME to the supposed "mild hybrids"!
I agree. "Mild hybrids" were a way for companies to exploit the system, without investing in real hybrid technology.

Case in point, Maruti's SHVS. All it borrows from the parent is the name and none of the real stuff.
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Old 3rd April 2017, 12:04   #7
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Quote:
Originally Posted by Chetan_Rao
Want benefits?
Hero Moto Corp gets to run a full page ad Worlds first production hybrid, Splendor iSmart.

Indian makers made this hybrid word a joke by exploiting this loophole. Like this Unlimited 3g / 4g plans. (my personal views only)

Last edited by NaXal : 3rd April 2017 at 12:09. Reason: Spelling mistake corrected
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Old 3rd April 2017, 12:21   #8
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Maruti has made use of this fully till date. Would the Nexa Ciaz prices increase now?? Nevertheless, it is still a good move by the government!! If this had continued, many more manufacturers would have followed the same. I am sure most of them would have already invested on it and Maruti should be happy as they have utilised this loophole to the max.

Last edited by Dr.Naren : 3rd April 2017 at 12:24.
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Old 3rd April 2017, 12:36   #9
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

After 73,633 units sold, the Mild hybrid scheme is withdrawn. Expect Suzuki - Toyota alliance to step up the Hybrid/EV scene in India soon!

No FAME subsidy for mild hybrids from April 1, 2017-subsidyforvehiclesunderthefameindiascheme1.jpg

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Last edited by volkman10 : 3rd April 2017 at 12:37.
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Old 3rd April 2017, 12:36   #10
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

The first time I read about the 'Hybrid' Ciaz and it's exemption in the 'Even-odd' implementation @ Delhi, I went and read about what was the 'Hybrid' part.
Needless to say I had tears in my eyes by the time I was done reading that article!

I wonder how folks are able to justify such tactics!
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Old 3rd April 2017, 12:41   #11
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

This will affect Ciaz the most, as it is being moved to Nexa and this news removes the cost benefit and it is bound to cost more.

People who do not understand the SHVS concept would associate the cost hike to the movement to Nexa which might have a negative effect.

How MSIL prices the Nexa Ciaz would be interesting.

Last edited by Karthik Chandra : 3rd April 2017 at 12:43.
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Old 3rd April 2017, 12:50   #12
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

My understanding is that it's the subsidy of 13K which is withdrawn, and the lower tax of 13% as against the 24% (for bigger cars like Ciaz and Ertiga) vehicles is still in place. Correct me if I am wrong.

This may be a move to streamline the vehicle tax system post GST implementation, IMO.
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Old 3rd April 2017, 14:34   #13
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Now that subsidy is gone, I have a feeling that the 'Mild' hybrid system in Ciaz and other models may be removed.
The benefits offered by system were minuscule.
Why add to cost, complexity and weight of the vehicle for such small efficiency benefits.

Only advantage it offers, is some immunity, against knee jerk & illogical rulings by NGT, Supreme court etc, Odd-even rule etc.
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Old 3rd April 2017, 14:45   #14
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

Good. Every vehicle incl those with start-stop were being marketed as Hybrids, and our gullible buyers fell for it. This is not a hybrid in my parlance.
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Old 3rd April 2017, 18:05   #15
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Default Re: No FAME subsidy for mild hybrids from April 1, 2017

If one has to make categories, simple three stage categories can help in deciding the benefit structure. As per my understanding (correct me where I am wrong).

To qualify, electrical motor must be there to assist in powering the driven wheels. Now to category of benefit:
  1. Vehicle with electrical motor assist. But which can't drive alone with electric motor (or has a very limited range maybe)
  2. Vehicle which can drive with electrical motor and without the help of gasoline engine, but has the engine for longer range and more power (when or if needed). e.g Toyota Prius.
  3. Vehicle which has only electrical motor or rather EV (electrical vehicle). e.g Mahindra REVA / e2o

Last edited by GTO : 4th April 2017 at 10:01. Reason: Poorly typed post
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