This week in Auto: Tata Nexon EV gets HC relief; Auto sales grow 205 in Feb; Misplaced auto fuel strategies?

Even as the debate of whether India choosing to be all electric for the future is open for discussion, government of India has gone ahead and notified ethanol blending to 20 percent in the near future. It is another matter of discussion about where does the current blending levels of ethanol in petrol stands. More on this later in the copy but first here is a complete look at what made headlines in the auto space during the week.

Tata Motors gets stay on Nexon EV delisting

The Delhi High Court granted interim relief to Tata Motors by directing a stay against the delisting of the Nexon EV by the Delhi Transport Corporation (DTC).

The Mumbai-based company had challenged the AAP government’s decision to withdraw Rs 300,000 subsidy to the Nexon EV.

Auto sales grow 10%: SIAM

Automobiles sales during February recorded a rise of 10.2 percent to 281,380 units against the same month in 2020, helped by sustained demand for two-wheelers and SUVs, data from SIAM show.

As per data shared by the Society of Indian Automobile Manufacturers (SIAM) passenger vehicles (cars, SUVs and vans) sales during February grew by 18 percent to 281,380 units while two-wheeler sales grew by 10 percent to 1.42 million units.

Retail PV sales grow 11% in Feb

Retail volumes of passenger vehicles (PV) swung back into the black in February reporting a growth of nearly 11 percent after January proved to be a disappointment.

According to data sent by the Federation of Automobile Dealers Association (FADA) PV retails ended February at 254,058 units while the same month last year saw sales of 229,734 units.

Govt notifies use of E20 blending

The Ministry of Road Transport and Highways (MORTH) has notified the use of E20, a mix of 20 percent ethanol and 80 percent petrol. A notification was issued late on March 8.

The latest notification follows a draft issued by MORTH in December that spoke about type approval of pure ethanol, flex fuel and ethanol-gasoline blend vehicles.

Maharashtra plans Rs 9453 crore spend on charging infra

The Maharashtra government has planned an outlay of Rs 9,453 crore for setting up mega electric vehicle charging centres on key expressways connecting the state capital Mumbai.

A few charging stations operated by private companies are already in operation on the Mumbai-Pune Expressway. The Mumbai-Nashik Expressway is yet to have its first charging station while the Samruddhi Expressway itself is under construction.

Shareholders approve Tata Motors PV hiving plan

Tata Motors on Monday said its shareholders have approved hiving off its passenger vehicles business into a separate entity.

On March 5, the shareholders of the company voted to consider and approve the transfer of the passenger vehicles business unit to TML Business Analytics Services Ltd as a going concern on a slump sale basis for a lump sum consideration.

The changing times of future

Even as the government pushes the auto industry to make electric mobility the immediate future of their strategy, simultaneously it is also pushing for use of alternate fuels instead of petrol and diesel.

Earlier this week the Ministry of Road Transport and Highways notified increasing the use of ethanol in petrol to 20 percent without providing any timeline for the total adoption. Though this was in the works for some time, it still has, nevertheless, raised a few eyebrows.

For one the government has been steadfastly pushing for mass adoption of electric mobility. Likewise, almost every automaker has either introduced at least one fully electric product in the market or is in advanced stages of its development thereby setting aside separate investments for the same.

Before the electric push was the rush to have CNG as an alternate fuel option. Natural gas was cheaper than petrol or diesel and produced in India. Carmakers like Maruti Suzuki and Hyundai launched CNG variants of their best-sellers hoping to cash in on the demand.

Almost simultaneously was the push for LPG but it did not find many takers are had to be brushed under the carpet. But for the immediate future, the government is egging the auto industry to look at LNG and Hydrogen. While LNG is nothing but natural gas in liquid form, hydrogen, however, is a new fuel altogether, requiring a new management apparatus.

An auto company with a strong research and development backbone would be assumed to be working on each of these fuel technologies but if there are no decent paybacks then all of this leaves nothing but holes in the company’s profits.

“As an automotive company, we cannot bank on one business set. Yesterday it was petrol but tomorrow it will be electric and we should all move unidirectionally. But we certainly feel confused when a Niti Aayog or some senior minister advocates switching to some other fuel. Then our planning and budget estimates go for a toss”, said a senior executive of one of India’s biggest car making companies.

“We are managing crash norms, meeting emission norms, accommodating all regulatory changes demanded by the government, working for next set of emission changes, work on alternate fuels, electric, hybrid, suppliers, customers, dealers. There is a lot on our plate than what seems”, said another top executive from the R&D team working for a multinational auto brand.

To make matter worse the government shuffles deadlines mid-way. For instance, the Bharat Stage VI emission standards were advanced by 2 years to April 2020. Mandatory fitment of airbags was advanced to July 2019 as against October 2019. Even the ethanol blending of E20 worked upon to be advanced to 2025 instead of 2028.