CAFE-III tightens carmakers' fuel-efficiency targets from FY28, retains hybrid incentives
The notified norms apply from April 2027 to March 2032, lowering fleet fuel-consumption targets from 3.996 L/100 km in FY28 to 3.3273 in FY32. Credit trading and retained hybrid incentives shape compliance options for Maruti Suzuki and Toyota Kirloskar Motor.
The development
The Ministry of Power notified CAFE-III norms effective from April 1, 2027, to March 31, 2032. Tighter fleet fuel-efficiency targets, credit trading and retained hybrid incentives reshape compliance strategies for Maruti Suzuki India Ltd and Toyota Kirloskar Motor.
The numbers
- April 1, 2027
- March 31, 2032
- 3.996 litres per 100 km
- 3.3273 litres per 100 km
- FY28
Why it matters to operators and investors
Align FY28–FY32 product mix and retail messaging with tighter fuel-efficiency targets, while incorporating retained hybrid incentives and credit trading into compliance planning.
What to watch next
- Implementation details governing credit eligibility, trading and the value of hybrid incentives.
- Credit availability and transaction prices relative to the cost of changing vehicle mix.
- Hybrid waiting periods, component localization and purchase-price premiums versus comparable petrol models.
- EV and hybrid retail registrations rather than launch announcements alone.
- Manufacturer fleet-consumption disclosures and shifts in model-level discounts, dealer incentives and variant availability.