While speaking to reporters post the announcement of Maruti’s Q4 earnings on Friday, Bhargava said that the costs of today’s technology which goes into the Toyota hybrids is still quite high. And that is why the cost of the car becomes high.
While sharing the company’s intent to bring a cost-effective hybrid car, Bhargava said that the Suzuki Japan is working on a smaller hybrid car technology. He added that if the GST is lowered on hybrid cars, then the country can look forward to more affordable hybrid cars with much better mileage.
“A lot of work is going on in Suzuki Japan to evolve better technology which will enable smaller cars to take advantage of the principles of hybridization to improve fuel economies at a much more affordable cost. If this is aligned with lower GST, I think you can look forward to small cars with much better mileage than we have today,” Bhargava said.
Electric vehicles (EV) in India are taxed at only 5%, whereas hybrids are taxed as high as 43%, just below the 48% tax imposed on petrol cars. Recently, Union Minister Nitin Gadkari mentioned that the proposal to decrease GST on hybrid vehicles to 5% and to 12% for flex engines has been forwarded to the Finance Ministry for consideration.
“The market for hybrids, to an extent, is determined by their price. It is uncertain what the final decision of the GST Council will be. We will have clarity after the elections, so let’s be patient for a few months. I think that will then determine how far and quickly the expansion of hybrids and EVs will take place,” the Maruti Suzuki Chairman added.Hisashi Takeuchi, Managing Director & CEO, Maruti Suzuki however said the company has no ‘immediate’ plans to bring plug-in hybrids (PHEVs) to India. Notably, as per a report of ET Auto, JSW MG Motor plans to introduce its first plug-in hybrid electric vehicle in India next year, ET .
Maruti Suzuki is planning to begin manufacturing its initial electric vehicle for the Indian market within the ongoing fiscal year. Nevertheless, due to a pledge to export the initial batch to Europe, the vehicle is anticipated to be available in the domestic market by FY 2025-26.
By the fiscal year 2030-31, the car manufacturer anticipates that internal combustion engine (ICE) vehicles such as CNG, biogas, flex fuel vehicles, ethanol, and blended fuel will constitute 60% of its sales. Following this, 25% of the sales will be hybrid electric vehicles, while 15% will be battery electric vehicles (BEVs).
The target for the ongoing financial year is to achieve 600,000 units for CNG cars. In the financial year 2023-24, the company sold 450,000 units of CNG models. Additionally, the company is exploring the use of CNG to produce electricity for powering its manufacturing plants.
On Friday, the car manufacturer announced a 47% increase in its total net earnings of INR 3,952 crore during the January-March 2024 quarter. In the same period last year, the company had disclosed a net profit of INR 2,688 crore. The total revenue from operations in the fourth quarter was INR 38,471 crore, which was compared to INR 32,213.5 crore in Q4 FY23.