India's Top CV Makers Request Relief from Fuel Norms for Small Vehicles

Key Highlights:

• Tata Motors, Mahindra & Mahindra, and others want sub-3.5 tonne SCVs excluded from the upcoming CAFE 3 fuel norms.
• Over 80% of SCV owners in India are also the drivers, relying on these vehicles for daily income.
• Buying a new SCV in India costs over 40 months of a small operator’s earnings, compared to 9–10 months in Europe.
• Manufacturers warn that adding fuel-saving tech will raise prices and hurt small transport businesses.
• CV makers suggest reporting sales and emission data yearly instead of applying fuel norms immediately.

India’s major commercial vehicle (CV) manufacturers, including Tata Motors and Mahindra & Mahindra, are urging the government to exempt small commercial vehicles (SCVs) under 3.5 tonnes from the upcoming Corporate Average Fuel Efficiency (CAFE) 3 regulations. These new norms aim to improve fuel efficiency, but automakers say applying them to SCVs will increase vehicle costs and affect affordability for small business owners.

Why CV Makers Are Concerned

Most SCV buyers in India are owner-drivers who rely on these vehicles for their livelihood. Over 80% of them use the same vehicle to earn their daily income. Automakers argue that the financial burden on these users is already high.

Data presented by the companies show that buying a new vehicle in India typically costs more than 40 months' worth of a small operator’s income. In contrast, the same purchase in Europe only requires 9–10 months of earnings. This affordability gap makes any price increase a serious concern.

SCV owners generally earn between ₹5 lakh and ₹12.5 lakh annually. A rise in vehicle prices due to additional fuel-saving technology could discourage new purchases and negatively affect small transport businesses.

A Different Approach: Reporting Instead of Regulations

While manufacturers support the idea of improving fuel efficiency, they propose a different route for now. They suggest that SCVs under 3.5 tonnes be temporarily excluded from the CAFE 3 norms. Instead of enforcing strict fuel norms immediately, companies offer to share yearly reports with the Bureau of Energy Efficiency (BEE). These reports would include:

• The number of SCVs sold
• The types of fuel used
• Average carbon dioxide (CO2) emissions from these vehicles

This approach, they believe, offers a clearer picture of the market without harming small businesses.

A Smarter Way to Frame Future Policies

By gathering and analyzing real-world data from the SCV segment, policymakers can make better decisions in the long term. Automakers believe a flexible and informed method will lead to fuel norms that suit India’s unique needs and economic conditions.

At present, their main request is simple: keep sub-3.5-tonne vehicles out of the immediate scope of CAFE 3 norms so that affordability, business continuity, and employment are not negatively impacted.

Also Read: Tata Motors Registered 30,238 Commercial Vehicle Sales in June 2025

CMV360 Says

India’s top CV brands are not opposing cleaner fuel rules; they are asking for a practical and phased approach. With small transporters forming the backbone of local logistics, balancing environmental goals with economic realities is critical. The decision now rests with the government on whether to offer temporary relief or move ahead with strict fuel efficiency rules.