The industry representatives including members from Society of Indian Automobile Manufacturers (SIAM) has informed the government that high vehicle costs, low incomes, and limited financing options make N1 vehicle ownership in India significantly less affordable in comparison to global scenario.
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RAMESHKURUP S
The Indian auto industry has urged the government to extend Corporate Average Fuel Efficiency (CAFÉ)-3 norms primarily because of growing concern about the steep fall in sales of light commercial vehicles (N1 category, with a maximum mass not exceeding 3.5 tonnes), sources said.
A meeting between the industry and the Ministry of Road Transport and Highways (MoRTH) on Wednesday turned into an exhaustive discussion about how to arrest the fall in N1 category of commercial vehicles. A document exclusively sourced by businessline shows the extent of the fall of these vehicles.
The industry representatives including members from Society of Indian Automobile Manufacturers (SIAM) has informed the government that high vehicle costs, low incomes, and limited financing options make N1 vehicle ownership in India significantly less affordable in comparison to global scenario.
Since 2021-22, sales of such vehicles also have dipped and they are in declining trend with a compound annual growth rate (CAGR) of -1.64 per cent, they informed.
“This segment is highly sensitive to macro-economic volatility and uncertainty. A temporary uptick in sales was observed post-Covid driven by replacement demand and increased need for last-mile delivery solutions, but subsequently, sales have resumed a downward trajectory,” said a source privy to the meeting.
Therefore, SIAM proposed a phased evaluation approach by OEMs for the relevant vehicle categories, with fuel economy norms to be established based on results from the evaluation stage.
According to sources, SIAM proposed for a phase-wise implementation across various tonnage categories starting with phase-I from April 2028 (for 12 tonnes to 28 tonnes), followed by 28 tonnes to 55 tonnes in phase-II by April 2029 and 3.5 tonnes to 12 tonnes from April 2030 in phase-III.
However, not all in the industry are agreeing to such a proposal, especially when it comes to the N1 category, saying that would dilute the whole purpose of Constant Speed Fuel Consumption (CSFC, similar to CAFE norms) norms for commercial vehicles. CSFC involves testing fuel efficiency at specific, constant speeds.
Emission norms
The purpose of the government is to reduce the CO2 emission from these vehicles, so postponing of the norms would impact the environment, said one of the industry sources.
“Some OEMs are asking for postponing the norms for the N1 category, which will dilute the whole purpose of environmental control. Instead of testing of the vehicles for the emissions, they were asking for using a fixed formula, which again, dilutes the emission norms,” the source added.
The CSFC norms for light, medium and heavy-duty vehicles were made applicable from April 1, 2023. The norms were based on the fuel consumption at constant speed of 40 and 60 km ph for vehicles having gross vehicle weight (GVW) from 7.5 tonnes to 55 tonnes GVW and at constant speed of 50 km ph for 3.5 tonnes to 7.5 tonnes GVW vehicles.
In a meeting held on March 10, 2025, the Bureau of Energy Efficiency (BEE) had proposed CAFÉ based CSFC norms as the next phase of fuel emission norms from April 2027.
Published on July 3, 2025
