[DukeNukem]

After four years of uncertainty over fresh fuel efficiency standards for the Indian auto industry, the Prime Minister’s Office (PMO) has finally sanctioned this development.

The new standards, set as corporate average fuel consumption (CAFC) standards, had been primarily delayed due to disagreement between the government and the auto industry representatives.

The CAFC standards are currently awaiting notification from the Bureau of Energy Efficiency. The road and transport ministry will then be responsible for its implementation.

PTI estimates that the new standards will save the country 3 million metric tons of oil (Rs 13,835 crore annually) by 2015.

Cars will be categorised into 8 weight categories and each category will have a different fuel efficiency target. Currently, the top 10 car manufacturers which account for 96% market share have an average fuel efficiency of 16.42 km/litre. The CAFC standards will aim push this to 18.15 km/litre by 2015.

Analysis

As expected, SIAM and the auto industry opposed this development claiming that the targets are unrealistic and could compromise cost and safety. In the past, they have blamed the condition of roads and fuel quality as reasons for not being more fuel-efficient. But experts like the International Energy Agency have pointed out that these reasons are without basis.

This move could also encourage manufacturers to produce more cars with smaller engines that are turbo charged in order to balance fuel efficiency and performance.

However, the CAFC guidelines can also be seen as a somewhat indulgent move by the government. Two reasons; first fuel efficiency has always been a priority in the Indian market and carmakers would strive to produce fuel efficient cars with or without the government guidelines. Secondly, the current market is dominated by diesel cars, which are inherently fuel efficient. So this move could affect how petrol engines are used, considering they heavily lag behind their diesel counterparts in terms of mileage.

[a4anurag]

When something good is done or trying to be done then there would be 100's to pull it back.

What are those 8 classes used for division? Any idea?

SIAM is not happy with this move as they would have to get into more of R & D for getting fuel efficient vehicles at a lesser cubic capacity or the same ones. Increase in R & D costs, manufacturing costs since they would have to update the technology with what was being supplied. Emission norms would become stricter and HOPE it is done for the CV range as they are the ones who consume more of Diesel and pollute more too.

Good that such thing is undergoing but why doesn't the PMO think to get rid of the CV that are older than 10 years as they would be out of fitness as well as maintenance hence pollute more and do harm.

Lets hope for some good and what could be the final outcome.

[sureshurs]

This is a good move by Government. It seems like the target fuel efficiency set by the government would set the floor and market dynamics along with consumer behavior will drive the manufacturers to go higher than the govt target. Hopefully the targets would be different for petrol and diesel powered cars

[arjab]

Assuming the CAFC standards are realistic and takes into consideration some of the shortcomings in our country such as the inconsistent quality of fuel across cities / towns etc, OEM's should not crib too much.

In our country, nothing will happen on a voluntary basis until and unless it is "legislated" and "forced" upon companies.
If we look backwards most technological improvements that we take for granted today have happened due to changes in homologation norms or government mandated norms - not pioneered by a single OEM operating in our country. Example: High Mounted Stop Lamps, Side Intrusion bars, MpFi engines, Front ELR safety belts etc etc all came into being because OEM's were forced to do it due to the changes in legislation.

The CAFC legislation is a good step and GOI should keep up the pressure by reviewing the legislation at suitable intervals and updating it.

Going slightly here : the next big change the Government should push through, come what may, should be the Crash & Pedestrian Safety norms, suitably aligned to Euro NCAP norms, but maybe with a lower threshold criteria for our traffic and driving patterns .
From what i hear, the lobbying by OEM's against the implementation of these impending crash norms, (tentatively i think 2014-2015) is unbeliveable. If these norms are implemented many major models of OEM's in India may have to cease production which i am sure will not reflect well on the balance sheets of car companies !

[swiftnfurious]

I seriously hope the OEMs don't resort to making feather weight cars to improve FE. Would anyone know what other guidelines are approved along with this? Would love to read complete details. I would be extremely happy if PMO has advised on a minimum power output in each category, might have pushed the OEMs to bring in turbo versions of the petrol engines too.

[giri1.8]

Government should look into safety too! Else manufactures will just reduce the weight of the car just to increase the mileage by few Kmpl.

[rohanjf]

How is the fuel efficiency of a car going to be determined? I am guessing, with the same ARAI process. If so, the manufacturers cannot complain about bad Indian roads!

I really hope that the cars are going to be taxed based on how inefficient they are, rather than their length and cubic capacity.

[a4anurag]

Originally Posted by rohanjf

I really hope that the cars are going to be taxed based on how inefficient they are, rather than their length and cubic capacity.

ARAI procedures would be better and standard so as to keep it uniform for all the cars what ever segment they belong to.

Just imagine taxing on fuel efficiency and if the Audi A8 W12 was still on sale or an Mercedes AMG!

[DukeNukem]

Originally Posted by a4anurag

What are those 8 classes used for division? Any idea?

This link should help explaining the categories: source image

[StarrySky]

Originally Posted by swiftnfurious

I seriously hope the OEMs don't resort to making feather weight cars to improve FE.

I think the regulation is to mandate more FE in each weight category. Manufacturers may cut weight to achieve this. However, making cars too light may be counter-productive after a point, since it will mean they will fall to a lesser weight category which demands even more FE.

[Daewood]

Originally Posted by giri1.8

Else manufactures will just reduce the weight of the car just to increase the mileage by few Kmpl.

No. They will increase the weight by a few kgs to get into the next higher weight category, which will have a lesser fuel efficiency target.
The losers will be the ones who have to increase their weight by more than 100kgs to get into the next category. Very unfair rule.

IMO this grouping together is as foolish as the '4metre small car' rule. It should be based on a ratio of actual weight to actual fuel efficiency, rather than 'grouping' which will surely be manipulated by our shrewd manufacturers.

[mayankjha1806]

A popular publication reported, if these standards are implemented it would increase fuel efficiency in small cars up-to 20-25%, and this would translate into savings of about 2.5 Billion $$ for GOI.

This data alone is sufficient to seriously implement this, as oil is a precious natural resource. I see this as a positive move by the GOI as this would force manufacturers to invest in R&D which most have avoided so far, barring a few.

[theMAG]

Originally Posted by swiftnfurious

I seriously hope the OEMs don't resort to making feather weight cars to improve FE.

They already have. The sheet metals used today are progressively thinner than in the past. You may want to check out an Innova- as an example.

[fuel_addict]

A good move by the GOI but one which relegates safety norms further onto the backseat. Expect lighter and more fuel efficient cars now. I would like to see safety standards being made mandatory in all vehicles in addition to the FE numbers. ABS and atleast 2 airbags should be made standard in all vehicles.

Even if FE numbers are achieved by the manufacturers, the actual numbers in the real world situation will be much lower (60% I would say in metros) given the traffic and quality of roads.

[tsk1979]

I am wondering how do road conditions matter.
In the west, EPA etc., have a standard test pattern to get fuel efficiency.
If somebody is driving in traffic which crawls at 2kmph, he is not going to get EPA rated FE, right?
Same thing will be done here. There will be a standard test pattern. That will be used to measure FE.
mfrs will have to keep improving. The only way to improve FE quickly for your fleet is to increase percentage of diesel cars in your portfolio.