Wary of GST, Mahindra mulls launching 48V Mild Hybrid system in India

Under the new Goods and Services Tax (GST) structure, the highest tax rate is levied on hybrid vehicles.

Amidst rumours that popular UV maker Mahindra and Mahindra is mulling withdrawal of SUV Scorpio Intelli-Hybrid from the Indian market due to the higher tax slab for hybrid vehicles, the latest reports suggest that the company could bring a more powerful 48V mild hybrid system to India.

A report of AutocarIndia says that although Mahindra is considering the development of 48V mild hybrid system, the launch of this would depend on the tax system. However, Mahindra could consider it for the export market. The 48V hybrid system is currently used in cars in Europe, which uses an additional battery and a starter-generator to convert braking energy into electricity.

"Mahindra is working on 48V mild-hybrid technology and will continue to do so in order to be ready with a product using this technology. Launching this product though would depend on whether there is a re-think on the taxes for hybrids. Otherwise, it will be difficult to justify the launch of such a vehicle in India," the publication quoted Pawan Goenka, Managing Director of Mahindra & Mahindra Ltd.

Under the new GST (Goods and Services Tax) structure, the highest tax rate is levied on hybrid vehicles. The hybrid vehicles attract a steep 43 percent on total levies under GST (28 percent tax and 15 percent cess).

There have been rumours that Mahindra may pull out Scorpio Intelli-Hybrid in the coming months as there is a higher tax on such vehicles in the country. The Intelli-Hybrid technology reduces fuel consumption by up to seven percent by assisting the engine with electric power during acceleration. It automatically switches the engine off while the vehicle is stationary (start-stop) and regenerates brake energy while applying brakes to charge the battery.

Source: ACI