Around six new compact hybrid cars could arrive in India within the next two years as brands like Maruti Suzuki, Toyota, Hyundai and Renault prepare petrol/electric models for the mass market. The proposed launches will primarily target vehicles measuring less than four metres in length and they could extend hybrid technology to smaller cars at prices below those of the existing hybrids currently available in India.
The revised GST structure has improved the tax position of qualifying compact vehicles. Small hybrids that meet the applicable length and engine capacity criteria attract 18 per cent GST against 43 per cent under the previous structure. The existing hybrid offerings from manufacturers such as Maruti Suzuki, Toyota, Hyundai, Honda and Kia generally cost upwards of Rs. 15 lakh and measure more than 4.3 metres.
The lower tax rate could help manufacturers introduce hybrid technology at more accessible prices. The upcoming CAFE 3 regulations, scheduled to take effect on April 1, 2027, provide another incentive for manufacturers to develop electrified powertrains. The regulatory framework assigns a 1.6 super credit multiplier to conventional hybrid electric vehicles.
Plug-in hybrids and flex fuel HEVs receive a 2.5 multiplier while ethanol flex fuel vehicles qualify for 1.1. The credits contribute towards fleet average emissions calculations and could improve the regulatory case for compact hybrid models. The country’s largest carmaker, Maruti Suzuki, is expected to jump onto the bandwagon by bringing in its in-house series hybrid tech.
It could be incorporated in volume-based models such as the Fronx, Baleno, Swift and Brezza. The system differs from regular parallel hybrids as the petrol engine generates electricity and an electric motor drives the wheels. The first production model could arrive as early as next year and Suzuki has also outlined a separate range extender concept called REEV Light as well.
It will enable external charging capability and a battery configured for the intended application. The Toyota Urban Cruiser Taisor could receive the same series hybrid technology after its introduction in the Maruti Suzuki Fronx considering the partnership between both brands and the rebadged models contributing to Toyota’s high volume sales locally.
Hyundai could introduce a small hybrid offering around in 2027 as well but it remains a speculation at the moment but we already know that the next-gen Creta is a serious contender to get a strong hybrid system. Renault is also expected to enter the category through its compact SUV based on the Bridger concept which made its global debut a few months ago.
The Renault model is scheduled for late 2027 and could receive a hybrid powertrain. The potential of smaller hybrids is substantial considering the size of the compact SUV space and that the consumers going for affordable EVs could be lured in as well.
