SUV specialist Mahindra & Mahindra (M&M) does not have any immediate plans to go after hybrids even as car market leader Maruti Suzuki and its Japanese partner Toyota have rallied behind the new vehicle technology and received favourable response from the market for their new hybrid models.
While hybrids are only partially green, running on a combination of a petrol engine and electric batteries, and resulting in a 30-40 per cent higher mileage than petrol-only engines, they do not enjoy any tax benefits from the government.
Maruti Suzuki entered the strong hybrid segment with the petrol-powered Grand Vitara SUV, which it claims, can deliver a mileage of 28 km per litre. Toyota Kirloskar unveiled the Urban Cruiser Hyryder a few weeks ago, offering a similar mileage.
Fully electric models from Maruti and Toyota will not debut before 2025 and therefore both companies have relied on hybrids for the time being.
Call to cut GST
Some domestic car companies have lobbied with the government seeking a cut in Goods and Services Tax (GST) on hybrids. The GST on electric vehicles (EVs) is 5 per cent and carry no cess whereas hybrids have an applied duty of 43 per cent, including 15 per cent cess.
Anish Shah, Managing Director, M&M, said, “EV is what really drives a greener environment. Hybrids get there only partially. So why do something partially? For us we will come up with the best set of EV products which will be far better than what we could see we would do on hybrids, as we think about the transition from ICE (internal combustion engine).”
Maruti Suzuki claimed that of the 20,000 bookings it received for the Grand Vitara, the mid-size SUV slated for launch next month, about 45-50 per cent were for the hybrid versions. The Delhi-based company maintains that hybrids provide a scalable solution towards decarbonisation.
Rahul Bharti, General Manager, Corporate Strategy and Investor Relations, Maruti Suzuki, said, “If India has to decarbonise, there’s a major advantage with strong hybrids because they do a good fraction of the job of an EV and are many times more scalable. So, we can attack decarbonisation in a large way. I think it’s a matter of time before customers see the benefit and are willing to pay more for it.”
Govt support for EVs
Rajesh Jejurikar, Executive Director, M&M, said, “Our understanding so far is that the government is committed to supporting the EV programme. We and many others are making investments based on this policy. These are all substantial investments that the country is attracting on a laid out EV policy and we hope that there is no significant deviation from that.”
Tata Motors, India’s biggest electric car maker, agrees with M&M. The Mumbai-based company will stick to fully electric technology while keeping a watch on hybrids.
Shailesh Chandra, Managing Director, Tata Motors Passenger Vehicles and Tata Passenger Electric Mobility, said, “As a company we will be closely watching how hybrid gets adopted. But one thing is very clear. The long-term drivers of the auto industry and the regulations we have, and the environmental issues, EV is the long-term view. And therefore, as a company, we are going to remain focused on EVs.”