India needs to decide which clean car technology it wants to support to reach its goal of no emissions, said a top person from Tata Motors, India’s most valuable car company, on Friday.
“The government needs to be very clear about where they will spend their money to support a no-emission economy,” said CFO P.B. Balaji. He explained that car companies can’t invest in all technologies.
This was in response to a question about what Tata Motors thinks if the government reduces taxes on hybrid cars.
India taxes electric cars at only 5%, but taxes hybrids at a high 43%, just a bit less than the 48% for petrol cars.
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While some Japanese car companies want the government to lower taxes on hybrids, Tata Motors wants the government to stick to its current position.
The government has chosen what Balaji calls the main technology, which will need a lot of investment from car companies as they move from petrol cars to electric cars eventually.
To make this investment worthwhile, the government needs to help, he added. “We firmly believe, for good reasons, that’s where the support is needed,” he said. There shouldn’t be support for a temporary technology like hybrids, he said.
Electric cars are less than 2% of total car sales in India, but the government aims to increase this to 30% by 2030. Companies like Mahindra & Mahindra and Maruti Suzuki plan to launch electric cars in 2025.
Earlier, Tata Motors did much better than expected in the third quarter, making 70.25 billion rupees ($847.7 million) in profit, mainly because of strong sales in its British luxury car unit, Jaguar Land Rover.
