Small Cars to Get Pricier: Government Revokes Fuel Efficiency Exemption

• Indian government revokes proposed fuel efficiency exemption for small cars weighing 909 kg or less.
• Decision follows opposition from Tata Motors, Mahindra & Mahindra, arguing it unfairly benefited Maruti Suzuki.
• Maruti Suzuki, with 95% of India's small car market, relied on this exemption for models like Alto and Celerio.
• New CAFE-III rules, effective April 2027, tighten parameters and aim to reduce fleet-average CO2 emissions.
• Move pressures automakers to boost EV and hybrid sales, impacting affordable small car availability for middle class.