While carmakers like Tata Motors and MG Motor are focusing on battery electric vehicles (BEVs), Honda Cars India believes hybrid electric vehicles (HEVs) are a better choice for India in the journey towards electrification. “Until the time a nationwide charging infrastructure is set up for BEVs, HEVs can bridge the gap between internal combustion engine (ICE) vehicles and BEVs,” Takuya Tsumura, president & CEO of Honda Cars India, told FE.
BEVs, or in common parlance electric cars, have a battery that needs to be charged from an external source, such as a charging station. But according to a recent Icra report, “currently, there are less than 2,000 public charging stations in India with concentration in a few states and that too primarily in urban areas”. This makes BEVs (which have a range of 300-400 km) impractical for intercity travelling.
“HEVs, on the other hand, have both ICE (petrol engine) and electric motor, and once the electric motor loses charge, the ICE charges it on the go,” Tsumura added.
On Thursday, the Japanese carmaker unveiled the City e:HEV — a hybrid car —whose price will be announced in May.
The Indian government doesn’t give tax benefits to HEVs and treats these on a par with ICE vehicles (GST plus compensation cess of 28% for small vehicles and 45% for ones longer than 4 m). The GST on BEVs is 5% across the board, small or large. “From a taxation point of view, HEVs should be treated somewhere in between BEVs and ICE,” Tsumura said. Though he didn’t arrive at a figure, he hinted that anything in the range of 20-30% effective taxation can help make HEVs popular. “The City e:HEV, for instance, is about 40% more fuel-efficient than the petrol City, so it can help reduce the country’s fuel import bill as well as has lower emissions.”
The City e:HEV has a claimed fuel efficiency of 26.5 km/litre on petrol, compared with petrol City’s 18 km/litre.
Hybrid isn’t new for Honda. In 2006, it launched the Civic Hybrid, but discontinued it in 2010 due to low sales. In 2016, it launched the Accord Hybrid, but discontinued it in 2020. “Those two were imported models and attracted very high taxes,” Tsumura said. “The City e:HEV is a made-in-India car, and despite high GST we will be able to price it very competitively. I also believe the market, that time, wasn’t ready for hybrid cars, but now it is.”
He added that now electrified vehicles are becoming popular and “the City e:HEV is our first step towards electrification”.
On February 17, the Indian government notified the green hydrogen policy (hydrogen, when produced through clean energy such as solar, is called green hydrogen). Soon after, Toyota Kirloskar Motor started a pilot in India with the Mirai (the hydrogen-powered fuel cell electric vehicle, or FCEV). Honda is also big on this technology, but won’t bring FCEVs to India immediately. “At this moment, we are thinking of many options, including BEVs. We are doing a feasibility study of what is best suited for the Indian market,” Tsumura said. “As of now, HEVs are the most practical solution for India, especially when fuel prices are at an all-time high (on April 14, petrol was priced at about `105 per litre in Delhi).”
In 2023, Honda will also enter the midsize SUV market, currently dominated by Hyundai Creta and Kia Seltos. In FY22, according to data by the Society of Indian Automobile Manufacturers (Siam), 404,049 midsize SUVs were sold in India, which is 13% of the total 3,069,499 passenger vehicles. “That SUV is being specifically developed for India,” Tsumura said.
Honda will also continue offering diesel engines. “We have diesel in three models— the City, the Amaze and the WR-V,” he said. “In the City, diesel contributes 9% to sales, in the Amaze 10% and in the WR-V 23%. We don’t have a reason to move out (of diesel).”
