German luxury carmaker Mercedes Benz India has started introducing E25 compliant vehicles in the Indian market amid a government push towards increasing use of the locally produced biofuel and reducing dependence on imported crude oil.
Mercedes-Benz India Managing Director and Chief Executive Officer Santosh Iyer said the company had upgraded its portfolio in anticipation of future fuel regulations.
“All cars we are selling in India from start of this year are E25 compliant. We have done E25 so that in case the government decides in the future, the cars are already ready”, Iyer told ET, adding, the transition to E25 compatibility is part of its broader approach to future fuel and emission requirements while maintaining a wide range of powertrain options for Indian luxury car buyers.
The centre mandated nationwide use of E20 (20 per cent ethanol in petrol) with effect from April 2026. While testing began on usage of E25 petrol on vehicles, the government has not yet specified any timeline for introduction of the fuel in the country.
Mercedes-Benz said customer demand in India continues to be split across conventional internal combustion engine models and electrified vehicles, prompting the company to offer a mix of technologies. In the segments where the company has on sale all-electric options, the share of these variants have risen to 22-25 per cent.
“If you have the right product, value, price proposition, consumers are ready to shift to electric. On the other side, it can also be viewed that 75 per cent of consumers are still buying combustion engine cars, and for them we have an E25 compliant gasoline”, Iyer said.
He added that the company would continue offering internal combustion engines, battery electric vehicles and plug-in hybrids under a common product strategy.
Overall, Iyer said demand in the local market continues to be stable despite geopolitical uncertainties and the industry should close the year with a single-digit increase on sales. Iyer explained, “From a demand side, we still see a very strong momentum. But in September last year, when the GST rates were revised there was a significant uptake in demand. The challenge will be to outdo the significant base effect of the second half of the year. For us, the prognosis of a single-digit growth (in luxury car sales) continues. We don’t want to overestimate considering the geopolitical setup, also the worsening rupee, because that will further push up prices of our cars.”
Mercedes Benz India reported a growth of 9 per cent to sell 9,768 cars in the first half of the ongoing calendar year. The company has pending orders for 2000 vehicles, at present.
