Implementation of multiple proposed regulatory specifications can push up vehicle prices by 10- 12%: ICRA

Implementation of multiple proposed regulatory changes can increase CV prices by 10–12% over the medium term as they get implemented. However, the benefits in terms of vehicle safety, driver comfort, and export potential to developed markets, among others, are expected to outweigh the same, as noted in an update by rating agency ICRA.

The development comes at a time when the Indian automotive industry is undergoing rapid transformations, with increased focus by the centre on implementing emission norms, safety systems, and other standards that will bring India on par with other major automotive markets. 

Given the importance of the commercial vehicle (CV) sector in the Indian automotive industry, CVs account for the vast bulk of vehicle emissions in the country. Furthermore, mandatory Driver comfort and safety standards can significantly enhance driving conditions and road safety.

As a result, the industry has faced numerous regulatory interventions in the recent past. Adopting stringent emission requirements in a short period of time, as well as driver safety and security measures such as anti-lock systems (ABS), speed-limiting devices (SLD), and cabin blowers, are being used to reduce automobile emissions while also improving road safety and driver comfort.

There are also other planned regulatory amendments on the agenda. The required installation of air conditioners (ACs) in driver cabins has already been announced for January 1, 2025. Other criteria, like blind spot information systems and enhanced emergency braking, are also included. To increase road safety, solutions such as rollover prevention systems, driver alert systems, and so on are recommended to reduce the occurrence and severity of traffic accidents. Other rules, such as mandatory fire detection alarms and suppression systems, have also been introduced in categories such as school buses and intercity buses, beginning October 1, 2023.