No FAME subsidy for mild hybrids from April 1, 2017

The Government of India has withdrawn subsidies given to mild hybrid vehicles under the FAME (faster adoption and manufacturing of hybrid and electric vehicles) scheme. This change has come into effect from the start of this fiscal (April 1, 2017).

The FAME initiative was announced in April 2015, as part of the government's aim to promote the sales and use of eco-friendly vehicles in the country. Under this scheme, mild hybrids, full hybrids, plug-in hybrids and pure electric vehicles were awarded subsidies of up to Rs. 1.38 lakh for cars and Rs. 29,000 for bikes. However, post April 1, mild hybrids will not be able to take advantage of the scheme.

Maruti Suzuki will undoubtedly be the most affected automaker from the withdrawal of the subsidy. The company currently offers its mild hybrid system (SHVS) on the diesel versions of the Ciaz and Ertiga. Till now, both these cars benefitted from incentives worth Rs. 13,000 under the FAME initiative.

A mild hybrid vehicle generally comes with an automatic start-stop system that cuts off the engine when the car comes to a standstill and does not move for a considerable time period. The engine comes to life when the driver presses the accelerator pedal. Such vehicles are also equipped with a regenerative braking system that is capable of capturing the energy lost during braking and storing it in the car's battery. This stored energy is used to operate the starter motor when the car's auto start-stop system needs it. This entire process is said to enhance the car's fuel efficiency.

Source: PTI