Maruti Suzuki, India’s leading automobile manufacturer, has announced plans to introduce its first electric vehicle (EV) in the domestic market during the current financial year. However, the company is not putting all its eggs in one basket. Instead, it is adopting a diversified approach to address the country’s environmental and economic needs by promoting a range of eco-friendly technologies.
R C Bhargava, the Chairman of Maruti Suzuki, emphasised in the company’s annual report that alongside EVs, the automaker will encourage customers to adopt various alternative technologies. These include strong hybrid systems, biogas, flex-fuel, and compressed natural gas (CNG) vehicles. These options are available at different price points, aiming to reduce both emissions and fuel consumption across India.
Bhargava stressed the importance of a comprehensive policy framework to accelerate the transition towards these alternative technologies. Such a framework, he believes, would help minimise the sales of conventional petrol and diesel vehicles, thereby curbing emissions and fuel consumption in the country.
The company’s strategy, taking into account India’s economic and social environment as well as resource availability, is to offer customers a diverse range of vehicles with different technologies at various price points. While Maruti Suzuki plans to introduce electric cars in the coming months, Bhargava suggests that customers should also be encouraged to purchase vehicles equipped with strong hybrid technology, or those running on CNG, ethanol, or biogas. The ultimate goal is to minimise the use of pure petrol and diesel cars.
Maruti Suzuki is particularly enthusiastic about the potential of strong hybrid vehicles, which can reduce fuel consumption by 35-45 per cent. The company is also exploring the possibilities of biogas, which can be produced from agricultural, animal, and human waste. Bhargava highlighted that biogas is a completely renewable energy source with no import content and is overall carbon-negative. The company has already begun trial production of biogas and is looking forward to supportive government policies to facilitate the rapid development of this fuel.
These statements from Maruti Suzuki come at a time when there’s a divide among Indian automakers regarding the extension of benefits to hybrid vehicles in Uttar Pradesh. While companies like Maruti Suzuki and Toyota Kirloskar Motor advocate for rationalised taxes on hybrid vehicles to accelerate the transition to full electric, others such as Tata Motors and Mahindra & Mahindra argue that any benefits extended to alternate technologies might slow down the adoption of battery electric vehicles.
Currently, India imposes a reduced GST rate of 5 per cent on EVs, compared to 28 per cent (plus cess) on hybrids. Several state governments also offer additional incentives for EVs, including waiver of registration charges.
Bhargava addressed criticism that Maruti Suzuki has been slow to manufacture electric vehicles, explaining that the company decided to adopt a more diversified approach to meeting national objectives. He noted that the government has also recognised the need for different technologies in India, with some states like Uttar Pradesh already taking steps in this direction.
Maruti Suzuki currently offers two strong hybrid vehicles – the SUV Grand Vitara and the MPV Invicto. The company plans to launch its first EV later this fiscal year and aims to have about six models in the electric space by FY31.
However, Bhargava pointed out that the rapid acceptance of electric vehicles depends on reducing their costs and expanding charging infrastructure, which largely relies on localizing production and improving technology.
While focusing on new technologies, Maruti Suzuki remains committed to catering to various market segments. The company plans to produce more SUVs and higher-cost cars for different customer groups, but Bhargava emphasised that they “will never forget the needs of the large numbers who cannot afford expensive cars.”
The importance of small car sales for the sustained growth of India’s passenger vehicle market was also highlighted. Bhargava noted that small cars attract more first-time buyers to the market, and Maruti Suzuki’s efforts to manufacture low-cost small cars recognise the economic conditions of a large majority of citizens and their aspirations for comfortable and safe transportation.
Hisashi Takeuchi, the Managing Director of Maruti Suzuki, shared his personal mission to deliver the ‘joy of mobility’ to as many Indians as possible, noting that currently only 3 per cent of the Indian population owns cars.
In essence, Maruti Suzuki’s strategy reflects a balanced approach to addressing environmental concerns while considering the diverse economic realities of the Indian market, aiming to provide a range of sustainable mobility solutions across different price points and technologies.