Maruti Suzuki sees CAFE-III as boost as new norms favour weight-based targets

According to fresh market updates, Maruti Suzuki India, the country's largest small-car maker, is likely to benefit from the government's newly notified Corporate Average Fuel Economy (CAFE-III) norms, which set relatively softer efficiency targets for lighter passenger vehicles while requiring greater fuel-efficiency improvements from heavier cars.

The Ministry of Power notified the third phase of the CAFE norms for passenger vehicles late on Tuesday. The new norms will come into effect from April 1, 2027, and stay applicable until March 31, 2032.

The norms will apply to new passenger vehicles manufactured or imported for sale in India.

Under CAFE-III, the government has moved away from an explicit small-car concession. Instead, the revised target line has been flattened to provide a more balanced, weight-sensitive approach, bringing an end to a long-running debate among automakers over the treatment of small and large cars.

The reference weight has additionally been increased from 1,082 kg under the existing norms to 1,229 kg under CAFE-III, an gain of around 13.6%.

Maruti Suzuki welcomed the notification, saying the new framework recognises multiple powertrain technologies and fuels while encouraging research and development.

Rahul Bharti, Senior Executive Officer, Corporate Affairs, Maruti Suzuki, stated, “The CAFE regulation is a central policy instrument which accelerates India’s decarbonisation and energy security journey in the mobility sector. We welcome and appreciate the CAFE-III notification for M1 passenger vehicles issued by the Government of India. It is a comprehensive regulation arrived at after scientific data calculations and detailed stakeholder and inter-ministerial consultation with ambitious targets for energy efficiency improvement and CO2 reduction. The regulation recognizes the contribution of multiple powertrain technologies and fuels encouraging multi-faceted R&D and innovation. A credit/debit mechanism is an improvisation over the previous CAFE-II regulation. Maruti Suzuki is one of the front-runners in absolute efficiency performance in CAFE phases I and II and will continue its leadership in CAFE-III additionally.”