The Government of India has withdrawn subsidies for mild hybrid cars given under the FAME scheme.

The FAME (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme was introduced in 2015 offering a discount of up to Rs. 1.38 lakh on hybrid and electric cars. Mild hybrids were also a part of this scheme and because of this people who opted for Ciaz and Ertiga were receiving a subsidy of Rs 13,000.

However, that changes now with the Government deciding to withdraw subsidies given to mild hybrids. Mild hybrids will continue to attract a lower 11.5 per cent excise cut under the government’s union budget policy to promote cleaner technology.

There is a misunderstanding among the people that mild hybrid technology is same as the plug-in vehicles, but the truth is plug-in hybrids can run on electricity without the need for the main engine. On the other hand mild hybrid vehicle uses electricity only to start or stop the car engine when the car is at halt of traffic signal or stop. The electric motors in these mild hybrid vehicles assist the main engine by using recovered energy stored in a battery and helps save fuel.

Tests have shown that the mild hybrid vehicles are 7 to 15% more fuel efficient than the conventional hybrid system that can run on pure electric power for short distance.

The overall benefit given under the FAME scheme was approximately Rs 66 Crore. According to the Department of Heavy Industries, almost Rs 40 Crore of the funds allotted, which is close to 60% of the total allotments were directed towards the mild hybrid cars while the more eco-friendly (but more expensive) full electric cars got only about 14% of the total subsidy offered.