‘Incentives key for alternative fuel tech’

Toyota Kirloskar Motor Pvt. Ltd, the Indian unit of Japanese automotive giant Toyota Motor Co., has urged the government to offer incentives for alternative vehicle technologies, such as flex fuels, electrified hybrids, and ethanol-run vehicles, in addition to battery electric vehicles (BEVs), a senior company official said.

The company said new green mobility initiative is driven by high production costs of modern vehicle technologies with advanced features, compared to the cost of traditional internal combustion engine (ICE) vehicles, as it seeks to encourage the adoption of these alternatives.

Advancements carry higher price tags, necessitating government assistance to make them more accessible for early customers, the official added.

Toyota launched its inaugural flex fuel prototype, compliant with BS-VI phase II standards on Tuesday. Union minister Nitin Gadkari attended the launch event.

The automotive industry is witnessing rapid shift towards clean energy sources and technologies in response to global push for reduced carbon emissions and move away from fossil fuels.

“All OEMs (original equipment manufacturers) have to support the initiatives and are supporting them," Vikram Gulati, country head, Toyota Kirloskar Motor, said.

According to Gulati, incentives to make greener technologies more accessible will be key to drive adoption. “For any new technology, acceptance by consumers is key. And a key element of consumer acceptance, besides other factors, is the price of acquisition."

The auto industry requires government support to bridge the cost barriers of consumers opting for alternative technologies, Gulati said citing India’s taxation on automobiles.

The tax structure in India on vehicles is based on parameters such as ground clearance, and length that may have been relevant when such alternative technologies were not available, Gulati said. “Those rates, when applied on a technology whose manufacturing costs are far higher, lead to instances where incidence of taxation... turns out to be higher than petrol or diesel. We have to ensure vis-a-vis incumbent technologies, such newer technologies, which are greener and far more aligned with national goals are given favourable policy treatment compared to petrol, because that will ensure faster transition and consumer adoption."

Toyota Kirloskar said ethanol is an indigenously available solution for powering vehicles, aligning well with India’s self-reliance objectives, as well as supporting farmers and the rural economy. “This technology, of course, will require consumer adoption. Towards that, we are hopeful that suitable measures will also be put in place," said Gulati, seeking policy changes that would make these technologies competitive and preferred.

“In India, we’re trying to do electrification with a sharp focus on localization. One of the elements of our global alliance is element of sharing products, cross badging, which is, I think benefited both companies, because each company does come with a certain segment strength, and therefore, by getting some products, you’re also able to access a wider set of consumers.. Plus, it’s also a strategy to get together to be able to hasten the energy transition towards cleaner technologies," Gulati told Mint.