CAFE 3 norms retain weight-based formula, no small-car relief
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓The government notified CAFE-III norms on September 29, keeping a weight-based formula for passenger vehicles from April 1, 2027.
- ✓It rejected calls for small-car relief despite pressure from Maruti Suzuki.
- ✓Carmakers must now meet tighter fuel standards, though they can use new technologies to lower their overall compliance burden instead.
Story at a Glance
- Category
- BUSINESS
- Reported By
- MoneyControl
- Reading Speed
- 4 Minute(s)
- Market Focus
- India Economy
The government has notified the third phase of Corporate Average Fuel Economy (CAFE-III) norms without any separate concession for small cars, closing a policy debate in which Maruti Suzuki had pushed for differentiated treatment for smaller and lighter vehicles. The final framework, notified by the Ministry of Power on September 29, will apply to M1-category passenger vehicles from April 1, 2027 to March 31, 2032. It sets progressively tighter annual fuel-consumption standards for carmakers based on the weighted average unladen mass of their vehicle portfolios.
The notification does not contain the small-car-specific relaxation that had been discussed during the consultation process. An earlier draft had proposed a 3 gram CO2/km benefit for petrol cars weighing up to 909 kg, with an engine capacity of up to 1,200 cc and length of less than four metres.
Unlock the Full Story with ArthNow Premium
To continue reading this complete financial story and in-depth market context, upgrade to ArthNow Premium. Enjoy unlimited access across Web and Mobile.
MoneyControl
Read the full, original unfiltered story directly on the publisher's portal.