India needs an emissions-based vehicle tax system to boost newer technologies

Maruti Suzuki chairman RC Bhargava said that hybrid vehicles are cleaner than BEVs. An EREV or PHEV may be cleaner than a mild hybrid, but none of them are zero-emissions like a BEV.

Honda City e:HEV, a strong hybrid car | Photo: X (formerly Twitter)/@HondaCarIndia

Maruti Suzuki chairman RC Bhargava recently said that hybrid vehicles are cleaner than battery electric vehicles or BEVs when it comes to total emissions. This argument is facile because of dramatic changes in automotive and energy technology. 

Not all hybrids are created equal—something that was highlighted to me during a recent interaction with chairman emeritus of MG Motor India, Rajeev Chaba. He claimed that there is only one ‘true’ type of hybrid: the plug-in. Everything else is a ‘mild hybrid’.

The truth is that some companies, notably Maruti Suzuki, have skewed the discussion around hybrid technology. To understand how, let’s take a look at the four essential hybrid technologies that are in daily use across the world.

Mild hybrid

Maruti Suzuki calls this technology “Smart Hybrid” and Mahindra used to call it “Micro Hybrid”. Both terms, however, denote the start-stop technology that most carmakers in India offer today.

What it means is simply that at a traffic stop, the engine switches off automatically and the vehicle can run for 30-60 seconds on the battery. This is not a special battery, but a slightly larger one, placed in the engine compartment, often running at a higher voltage. 

After all, nobody wants to switch the engine off at a red light during summer. This system also keeps the fan and entertainment system going slightly longer. As the battery discharges, the Integrated Generator Starter (IGS) switches the engine back on. This can improve fuel efficiency by 2-5 per cent in urban conditions. 

However, the battery and electrical system do not drive the wheels. While some mild hybrids—particularly those from BMW and Mercedes-Benz—do regenerate power from the braking system, they are not true hybrids.

Strong hybrid

While Maruti Suzuki calls this technology “Intelligent Hybrid” on the Grand Vitara and Invicto, most other carmakers rightly call it a hybrid. It is a true hybrid: Both the fuel-powered engine and the battery-powered electric motor can drive the wheels. This is a highly complicated mix of an electrical and mechanical system.

Modern hybrids such as the Honda City e:HEV are pretty much supercomputers on wheels with the power control unit instantly calculating various factors to determine the power source at any given time. Under heavy acceleration, both the engine and battery can provide power. For low-speed, short-distance drives, the engine may never be required, unless the battery is out of charge.

In 2022, I spent almost two months driving the Honda City e:HEV in Delhi and found that I had a fuel economy of over 22 kilometres per litre, almost double that of my mother, who owns the Honda City with a petrol engine. But thanks to their computer systems and batteries, hybrids can cost significantly more than their internal combustion engine (ICE) powered siblings.

Despite some confusion in Uttar Pradesh, strong hybrid vehicles do not get any tax benefits from the government as compared to ICE vehicles. For instance, there is a difference of three to four lakh rupees between the prices of ICE and hybrid versions of the Honda City. 

Hybrid cars tend to have smaller battery packs and cannot be charged independently. That is why Toyota markets them as “self-charging” electric vehicles.

Plug-in electric hybrid (PHEV)

According to Chaba, the PHEV is the only true hybrid in the market—it can be charged from an EV charging point. Newer plug-in hybrids have battery packs that are larger than traditional hybrids but smaller than equivalent BEVs. 

PHEVs benefit from their pure electric range, usually more than enough to cover the daily commute for most people, which is about 50-100 kilometres. The Wuling Starlight S, which MG Motor plans to bring to India, will probably be launched in the market as a PHEV.

But the sheer efficiency of PHEV is leading to strange choices by carmakers. Mercedes-Benz has launched their 800-horsepower AMG S 63 E as a PHEV, the first in the Indian market. Its 13kWh battery with a fast discharge system makes its performance remarkable. Then again, it does cost a mere Rs 3.3 crore.

Extended-range electric vehicle (EREV)

Think of an EREV as the polar opposite of a mild hybrid. Both have a battery pack and an internal combustion engine, but only the engine drives the wheels in a mild hybrid. On the other hand, only the battery powers the wheels in an EREV. The smaller capacity engine acts as a generator for the battery and is driven by petrol, but can also be adapted for natural gas.

Most EREVs have a battery pack as large as a traditional BEV and can be charged the same, but boast a much longer range. Ergo, they take away the single biggest consumer issue plaguing electric vehicles: range anxiety. 

Because an EREV engine only charges the battery, it can run at its most fuel-efficient state at all times. And while the vehicle does cause emissions, considering that it can be charged at standard EV charging points, its emissions are much lower over a large distance than any other electric vehicle.

Li Auto isn’t a widely known company, but it is quite prominent in China as a“new energy vehicle” (NEV) manufacturer. All electric vehicles, strong hybrids, PHEVs, and EREVs are classified as NEVs in China. Li Auto is nipping at Tesla’s heels for the second spot in the Chinese NEV market, which is the world’s largest, thanks to the range of EREVs which have caught the eye of Chinese buyers.

So what next?

In the coming years, technologies such as hydrogen combustion or a new type of battery chemistry (like aluminium or sodium ion system) are likely to develop further. It is difficult to predict what will become commercially sustainable in the long run. This is why I think India should move to a more rational, emissions-based vehicle taxation system.

This is the fairest possible way to reward new technologies, encourage fuel economy, and promote zero-emissions vehicles. An EREV or PHEV will certainly be cleaner than a traditional strong hybrid, but none of them will be zero-emissions like a BEV or Hydrogen vehicle. 

Such a change, however, cannot happen through ad-hoc bureaucratic decisions; it must be a well-thought-out policy by the finance ministry and the states to promote local production and lower emissions. One way or another, there will be a lot of lobbying on this front, but India has been presented with the opportunity to take a progressive and reasoned step into the future.

@kushanmitra is an automotive journalist based in New Delhi. Views are personal.

(Edited by Prasanna Bachchhav)