Hy­brid Ve­hi­cles Of­fer a Way Out for Con­sumers Reel­ing Un­der Fuel Shock

De­mand for hy­brid au­to­mo­biles on the rise as aware­ness about pol­lu­tion grows

The Economic Times - - Companies - Sharmistha.Mukher­jee @times­group.com

New Delhi: Hy­brids are the flavour of the sea­son.

With fos­sil fu­els gain­ing vil­lain sta­tus in the bat­tle against pol­lu­tion, de­mand for hy­brid au­to­mo­biles — which carry a non-con­ven­tional propul­sion sys­tem, such as an elec­tric mo­tor, in ad­di­tion to the en­gine that runs on con­ven­tional fuel — is on the rise in In­dia. Re­cent de­vel­op­ments such as the Supreme Court-im­posed ban on the reg­is­tra­tion of large diesel ve­hi­cles in the Na­tional Cap­i­tal Re­gion and the odd-even ve­hi­cle ra­tioning in Delhi are also con­tribut­ing fac­tors, said in­dus­try ex­ec­u­tives. Sales of Toy­ota Mo­tor’s Camry Hy­brid rose more than 50% in the NCR in the past three months, said a se­nior com­pany ex­ec­u­tive. Maruti Suzuki has wit­nessed a sig­nif­i­cant jump in de­mand for its mid-size sedan Ciaz and the Er­tiga multi util­ity ve­hi­cle of­fer­ing mi­cro-hy­brid tech­nol­ogy to con­serve en­ergy. There are more in the off­ing this year. The new Toy­ota Prius is ex­pected to hit the road in In­dia in mid-2016, while Honda Mo­tor is set to bring its Ac­cord Hy­brid to­wards the festival sea­son. Hyundai Mo­tor and Volk­swa­gen had dis­played hy­brid ver­sions of the Sonata and Pas­sat sedans at the Fe­bru­ary Auto Expo. Hyundai, how­ever, said that the In­dia launch of the Sonata hy­brid may not hap­pen im­me­di­ately.

“Aware­ness is in­creas­ing,” said N Raja, di­rec­tor of sales and mar­ket­ing at Toy­ota Kir­loskar Mo­tor, the lo­cal unit of the Ja­panese au­to­mo­bile giant. “Since the SC ver­dict ban­ning larger diesel ve­hi­cles, we are sell­ing 65-70 units of Camry hy­brid in the NCR com­pared to 40-45 units ear­lier. These ve­hi­cles can also ply on both odd and even days, which is an added ben­e­fit.”

Hy­brid, elec­tric and CNG ve­hi­cles are ex­empt from Delhi’s odd-even rule that re­stricts ve­hi­cles on the road based on reg­is­tra­tion num­bers.

Toy­ota Kir­loskar sold more than 1,000 units of the Camry in 2015, and over 90% of those were of the hy­brid ver­sion. "Af­ford­abil­ity and value-for-money equa­tion is crit­i­cal. While in­ter­est is there, cost­ing is a chal­lenge in In­dia,” Raja said. “Strong hy­brids come at a price, al­most dou­ble that of a reg­u­lar ver­sion of a sedan. Im­ports raise prices fur­ther. We are the only man­u­fac­turer lo­cal­is­ing.”

While steep price is a de­ter­rent for many to buy hy­brids, the gov­ern­ment on its part has started do­ing its bit. It an­nounced in­cen­tives on the pur­chase of elec­tric and hy­brid ve­hi­cles un­der the FAME (Faster Adop­tion and Man­u­fac­tur­ing of Hy­brid and Elec­tric Ve­hi­cles in In­dia) scheme. It of­fers a sub­sidy of .₹ 13,000 on eco-friendly ve­hi­cles like hy­brids. In ad­di­tion, cus­tomers get ben­e­fit from about 50% re­duc­tion in ex­cise duty. The to­tal in­cen­tive on the Camry hy­brid stands at around .₹ 70,000.

Hy­brid ve­hi­cles have also been ex­empt from the in­fra­struc­ture cess of 1-4% an­nounced in the fis­cal 2016-17 bud­get. “With the gov­ern­ment’s fo­cus to pop­u­larise hy­brid and elec­tric ve­hi­cles, and in­creased aware­ness among cus­tomers, we feel that hy­brid cars will have bet­ter ac­cep­tance in the mar­ket now,” said Jnaneswar Sen, se­nior vice-pres­i­dent for mar­ket­ing and sales at Honda Cars In­dia. The com­pany is get­ting ready to launch the Honda Ac­cord Hy­brid in In­dia this year.

Maruti, which in­tro­duced what the com­pany calls smart hy­brid tech­nol­ogy in Ciaz and Er­tiga last year, said it sold more than 47,500 units of these mild hy­brids in the past six to seven months.

Hy­brid, elec­tric & CNG ve­hi­cles are ex­empt from Delhi’s odd-even rule that re­stricts ve­hi­cles on the road based on reg­is­tra­tion num­bers

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