No detours: CAFE III to kick in by April 2027

The Indian government is set to enforce stricter Corporate Average Fuel Efficiency (CAFE) III standards for automakers starting April 1, 2027, following a recent meeting at the Prime Minister's Office. Officials have confirmed that there will be no extensions to the timeline for compliance, and car manufacturers will face penalties if they fail to meet the new emission targets. The latest draft proposes reducing average emissions to 77.08 grams of CO2 per kilometer by 2032, down from the previous target of 92.11 grams. While the auto industry has advocated for a less stringent target of 89.6 grams, the government maintains that adequate time has been provided for adaptation. Companies producing higher-emission vehicles will incur financial penalties, although those venturing into electric and hybrid markets can mitigate costs through credit systems. The Bureau of Energy Efficiency (BEE) is overseeing these changes, which are viewed as a necessary step towards more sustainable automotive practices. Despite industry concerns regarding the pace of emission reductions, the government aims to balance compliance with operational viability, particularly for smaller manufacturers, as it moves toward a greener future in transportation.