Shifting-Gears

Key Highlights Delhi’s draft EV Policy 2.0 proposes waiving road tax and registration fees for strong and plug-in hybrid vehicles. The policy aims to make hybrids more affordable, reducing upfront costs by up to INR 1.75 lakh. Automakers are divided, with some supporting the move while others fear it could slow EV adoption. The Delhi government is considering a major shift in its electric vehicle (EV) policy by extending tax benefits to hybrid cars. The draft EV Policy 2.0 proposes waiving road tax and registration fees for strong hybrid and plug-in hybrid vehicles priced up to INR 20 lakh (ex-showroom). Current policy Currently, these exemptions apply only to battery electric vehicles (BEVs), making hybrids a less attractive option for buyers. If approved, the policy could lower the upfront cost of hybrid cars by 10-15%, making them more competitive against conventional petrol and diesel models. Why focus on Hybrids? Hybrid vehicles combine a petrol engine with an electric motor, offering better fuel efficiency and lower emissions than traditional combustion cars. Strong hybrids can run on electric power alone for short distances, while plug-in hybrids have larger batteries that allow longer electric-only driving. The Delhi government aims to reduce air pollution and increase green mobility, with a target of 30% EV adoption by 2030. Since hybrids emit fewer pollutants than petrol or diesel cars, they serve as a bridge technology for buyers hesitant to switch to fully electric vehicles. Who stands to gain? Brands like Maruti Suzuki, Toyota, and Honda, which offer strong hybrid models such as the Grand Vitara, Urban Cruiser Hyryder, and Honda City e:HEV, could benefit the most. These companies have invested heavily in hybrid technology and see it as a stepping stone toward full electrification. On the other hand, Tata, Mahindra, and Hyundai, which focus primarily on BEVs, have raised concerns. They argue that hybrids still rely on fossil fuels and that incentives should be reserved for zero-emission vehicles. Industry reactions Automakers are divided over the policy. While hybrid manufacturers welcome the move, EV-focused brands fear it could slow down the transition to fully electric cars. Some experts believe that if Delhi sets a precedent, other states may follow, potentially reshaping India’s EV strategy. Uttar Pradesh was the first state to waive road tax and registration fees for hybrids in July 2024, sparking similar debates. If Delhi implements the policy, hybrid cars could become significantly more affordable, closing the price gap with petrol models. Also read: Delhi government to limit the number of cars per household

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