Demand for hybrid cars has been growing, owing to superior fuel efficiency compared to traditional internal combustion engine (ICE)-powered models and non-dependence on charging infrastructure.
Share of hybrids inched up to 2.5% in the first seven months of the current calendar year, compared to 2% in 2024, according to the government's Vahan portal. Hybrids' steep pricing premium over ICE models has failed to dissuade buyers.
Mahindra's popular SUV models - the Scorpio followed by the XUV700 which will be due for a full model change in 2026 - are likely to be the ones to get the petrol-hybrid powertrains, said a person aware of the plans. A growing demand for the technology, even without the policy support, has prompted the SUV major to gear up for hybrid technology.
In an email response, the company's spokesperson said, "From a consumer-demand standpoint, if hybrids become a big factor, we will be ready for it. We will also be ready for hybrids if there are significant changes in the technology - that makes hybrids much more efficient. At this point in time, we feel good about the focus on EV. But we are ready for hybrids; we are looking at hybrid technologies closely and we will continue to adapt as it develops."
M&M has committed an investment of INR 27,000 crore in the coming five to seven years in its automotive business, which envisages the company having a portfolio of 9 ICE SUVs and 7 electric vehicles, which is a fair mix of a cleaner vehicle portfolio.
Once ready, the Mumbai-based firm is also likely to share the hybrid technology with Skoda Auto Volkswagen. If the two companies conclude the discussions and sign an agreement to work together, Skoda VW will depend on Mahindra for the hybrid technology. That would be a lot more cost competitive as compared to the VW group bringing it from its own stable, said a person aware of the plans.
The two companies have been in discussion for sharing costs, technology and vehicle platforms and are likely to sign a 50:50 joint venture before the end of the current year, ET first reported in its August 30 edition.
A strong hybrid uses a combination of an internal combustion engine and electric motors to power the vehicle, resulting in better fuel economy and lower emissions than a traditional petrol car. It uses energy stored in batteries to power the electric motor, which can supplement the power of the internal combustion engine. The battery is charged through regenerative braking and by the internal combustion engine.
To be sure, the growing sales of hybrids in India and the incentives doled out by a few state governments for hybrids, is prompting other automakers who were earlier focused only on battery electric vehicles to cut the carbon emissions, to consider hybrids. Korean carmaker Hyundai Motor India, also has plans to introduce its first petrol-hybrid SUV in 2027, an auto industry magazine reported last month.
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