{"id":74372,"date":"2025-11-21T11:25:53","date_gmt":"2025-11-21T05:55:53","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=74372"},"modified":"2025-11-21T11:25:53","modified_gmt":"2025-11-21T05:55:53","slug":"indias-proposed-cafe-3-norms-and-the-auto-industry-split","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/indias-proposed-cafe-3-norms-and-the-auto-industry-split\/","title":{"rendered":"India\u2019s Proposed CAFE 3 Norms and the Auto Industry Split"},"content":{"rendered":"<h2 style=\"text-align: justify;\"><b>CAFE 3 Norms Latest News<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India plans to implement the third phase of <\/span><b>Corporate Average Fuel Efficiency (CAFE 3)<\/b><span style=\"font-weight: 400;\"> norms from FY28\u2013FY32 to <\/span><b>improve fuel efficiency<\/b><span style=\"font-weight: 400;\"> and reduce carbon emissions from passenger vehicles.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, the weight-based structure of the new norms has triggered <\/span><b>significant disagreement<\/b><span style=\"font-weight: 400;\"> within the auto industry, especially between manufacturers of small cars and those with a portfolio dominated by heavier SUVs.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Background<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li aria-level=\"1\"><b>What are CAFE norms?<\/b><\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li style=\"list-style-type: none;\">\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">CAFE norms <\/span><b>regulate <\/b><span style=\"font-weight: 400;\">average<\/span><b> fuel consumption<\/b><span style=\"font-weight: 400;\"> and CO\u2082 emissions across a manufacturer\u2019s fleet.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">It proposes a movement from the current Modified Indian Driving Cycle (MIDC) to the Worldwide Harmonised Light Vehicles Test Procedure (WLTP), which the European Union adopted in 2018.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">India follows a <\/span><b>weight-based formula<\/b><span style=\"font-weight: 400;\"> that becomes progressively stricter each year.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>CAFE 3<\/b><span style=\"font-weight: 400;\">:\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">It\u00a0 introduces a new weight-based efficiency formula &#8211; <\/span><b>0.002 \u00d7 (W \u2212 1170) + c.<\/b><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Here <\/span><b>W <\/b><span style=\"font-weight: 400;\">is the average fleet weight, 1,170kg is the fixed constant for weight, 0.002 is a fixed constant multiplier, and \u2018<\/span><b>c<\/b><span style=\"font-weight: 400;\">\u2019 is a constant that changes every year.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">Since \u2018c\u2019 continues to decrease from FY28 to FY32, the rules will become stricter over time.\u00a0<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Why the Industry Is Divided<\/b><\/h2>\n<ul>\n<li><b>Impact of the weight-based formula:\u00a0<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">Lighter cars face steeper efficiency improvements than heavier ones.<\/span><\/li>\n<li><b>Example: <\/b><span style=\"font-weight: 400;\">A 740 kg car needs to become 48% more efficient by FY32. A 2,500 kg SUV needs only 25% improvement, despite higher absolute emissions.<\/span><\/li>\n<li><b>Result<\/b><span style=\"font-weight: 400;\">: Greater regulatory burden on small, budget cars.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Small-car manufacturers\u2019 concerns:<\/b>\n<ul>\n<li><b>Disproportionate impact<\/b><span style=\"font-weight: 400;\">: Small cars operate on low margins and cannot easily absorb the cost of: hybrid systems, electrification, lightweighting technologies.<\/span><\/li>\n<li><b>Consumers may be priced out<\/b><span style=\"font-weight: 400;\">: Stricter norms may raise costs of entry-level cars. Could discourage first-time buyers and shrink the affordable car segment.<\/span><\/li>\n<li><b>Distortion of CAFE\u2019s original intent<\/b><span style=\"font-weight: 400;\">: Maruti Suzuki argues CAFE was meant to push big cars to improve fuel efficiency, not punish small cars.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Why some carmakers support CAFE 3:<\/b>\n<ul>\n<li><b>Tata Motors\u2019 stance<\/b><span style=\"font-weight: 400;\">: Claims no concerns in achieving the norms. Rejects weight-based definitions of small cars as \u201c<\/span><b>Arbitrary<\/b><span style=\"font-weight: 400;\">\u201d, potentially compromising safety standards.<\/span><\/li>\n<li><b>Others (Mahindra, Tata): <\/b><span style=\"font-weight: 400;\">Oppose higher exemptions for lighter cars.<\/span><\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Comparison With Global Norms<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Relaxed standards for smaller cars in many countries like the US, China, Japan, and South Korea.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Europe: <\/b><span style=\"font-weight: 400;\">Stricter norms overall, but smaller cars have relaxed CO\u2082 targets, while larger vehicles have tougher benchmarks.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s system is the opposite, creating a regulatory imbalance.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Key Technical Issues<\/b><\/h2>\n<ul>\n<li><b>\u201cBrick in the Boot\u201d concern:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">Manufacturers may artificially increase weight to enter a more relaxed efficiency band.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">May lead to production of bigger, heavier cars; reduced affordability; and increased emissions in absolute terms.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Relaxation for small cars:<\/b>\n<ul>\n<li><span style=\"font-weight: 400;\">Debate on the 3 g CO\u2082\/km relaxation for small cars with mass (\u2264 909 kg), engine (\u2264 1200 cc), length (\u2264 4,000 mm).<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Maruti and Renault want more relaxation.<\/span><\/li>\n<li><span style=\"font-weight: 400;\">Tata and Mahindra oppose increasing it.<\/span><\/li>\n<\/ul>\n<\/li>\n<li><b>Shift to WLTP: <\/b><span style=\"font-weight: 400;\">WLTP gives more realistic fuel economy figures than MIDC. Some manufacturers (e.g., Mahindra) requested a delay due to compliance challenges.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Challenges<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Threat to small-car market: <\/b><span style=\"font-weight: 400;\">Rising costs may make entry-level cars unaffordable. Could worsen the market shift toward high-emission SUVs.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Safety vs affordability trade-off: <\/b><span style=\"font-weight: 400;\">Weight-based relaxation may unintentionally encourage lighter designs at the cost of safety.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Technological feasibility<\/b><span style=\"font-weight: 400;\">: Small cars have limited scope for expensive efficiency technologies.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Potential loss of first-time buyers: <\/b><span style=\"font-weight: 400;\">A socially regressive outcome as small cars improve mobility for lower-income groups.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Risk of regulatory distortion: <\/b><span style=\"font-weight: 400;\">The framework may not truly reduce total CO\u2082 emissions, only improve averages on paper.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Way Forward<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Review of weight-based approach<\/b><span style=\"font-weight: 400;\">: Consider aligning with global best practices\u2014relaxing norms for lighter cars.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Technology-neutral incentive structure<\/b><span style=\"font-weight: 400;\">: Encourage all low-carbon technologies &#8211; mild hybrids, strong hybrids, EVs, cleaner ICE improvements.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Gradual phase-in of WLTP<\/b><span style=\"font-weight: 400;\">: Provide adequate transition time for manufacturers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Targeting real emission reduction<\/b><span style=\"font-weight: 400;\">: Shift toward absolute emissions caps instead of purely weight-based formulas.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Policy support for small cars<\/b><span style=\"font-weight: 400;\">: Financial incentives or tax benefits to protect the budget segment.<\/span><\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Conclusion<\/b><\/h2>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The proposed CAFE 3 norms mark a critical step in India\u2019s <\/span><b>low-carbon mobility transition<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, their weight-based structure disproportionately burdens small cars, risks market distortions, and may undermine affordability for first-time buyers\u2014contrary to the objective of inclusive and sustainable mobility.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A <\/span><b>balanced, evidence-based recalibration<\/b><span style=\"font-weight: 400;\"> that ensures environmental integrity while protecting the small-car segment is essential for achieving India&#8217;s long-term climate and mobility goals.<\/span><\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><b>Source: <\/b><a href=\"https:\/\/indianexpress.com\/article\/explained\/why-proposal-for-tighter-emission-norms-has-triggered-a-small-vs-big-car-debate-10377363\/#:~:text=They%20feel%20that%20in%20bigger,mixed%20views%E2%80%9D%20on%20the%20subject.\" target=\"_blank\" rel=\"nofollow noopener\"><b>IE<\/b><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The weight-based structure of the CAFE 3 norms has triggered significant disagreement, especially between manufacturers of small cars and those with a portfolio dominated by heavier SUVs.<\/p>\n","protected":false},"author":19,"featured_media":74389,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[2958,60,22,59],"class_list":{"0":"post-74372","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-cafe-3-norms","9":"tag-mains-articles","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-affairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/74372","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=74372"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/74372\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/74389"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=74372"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=74372"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=74372"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}