Thursday, November 30, 2023

Groupe PSA to launch a flex-fuel SUV in India in 2021


French automobile giant Groupe PSA is planning to enter the Indian market with cleaner fuel products. As it appears, Groupe PSA could become the first automaker in India to bring a flex-fuel engine car.

Interestingly, the French auto giant’s move comes in the same line as Union Minister for Road and Transport Nitin Gadkari, who has been advocating for the introduction of greener powertrain alternatives including flex-fuel engine in the country in a bid to reduce India’s fuel import bill.

Groupe PSA is working on a small SUV that will come powered by a 1.2-litre flex-fuel engine. According to the report, this small SUV’s petrol engine can run on ethanol blends starting from 27% to entirely on biofuel. The small SUV is codenamed as Project CC21 and is likely to hit the Indian market sometime in the second half of 2021.

The small SUV will be produced at the Thiruvallur facility in Tamil Nadu. Groupe PSA had acquired this plant from the CK Birla Group company Hindustan Motors.

Is a flex-fuel car viable for India?

The small SUV will be based on the automaker’s small car platform, internally dubbed as C-Cube. Ths platform is being developed especially for the emerging markets. India could be one of the key export hubs for this model. As the Latin American market has a large customer base for the flex-fuel engine powered cars, the Groupe PSA’s CC21 model could be shipped to the Latin markets from India.

In India, the CC21 will certainly have a first-mover advantage in the flex-fuel segment, as there is no other automaker with such product on offer in the country. However, there remains a question about how feasible this car would be for Indian customers.

The Indian customers, in general, are still largely focused on fossil-fuel models like petrol or diesel-powered vehicles. Lately, the CNG vehicles have seen a rise in sales, but the lack of CNG pumps outside the large cities have been a key problem in front of the adoption of the greener fuel solution.

Electric vehicles too are in a primary stage in India, as the large automakers are still shying away from launching electric cars or scooters in the country. Only a handful of automakers like Tata Motors, Mahindra & Mahindra, Hyundai and MG Motor have their respective cars in the segment. Among the major two-wheeler manufacturers, only Bajaj Auto has introduced its electric scooter e-Chetak.

However, the two-wheeler and three-wheeler segment has seen the rise in sales for the electric models lately, but that is largely dominated by startups. The lack of EV charging infrastructure, high price for the zero-emission vehicles have been key reasons behind the slow growth of electric vehicles, along with the low customer sentiment for such models.

While the flex-fuel vehicle too would face similar questions, the Government believes, this could be a bridge between the gap of fossil fuel vehicles and electric vehicles.

According to experts, ethanol-blended petrol usually offers lesser CO2 emissions. It also enhances the octane number of the fuel, offering higher performance alongside being environment friendly.

Concerns with ethanol blending

Currently, India’s majority of oil marketing companies blend 5%-7% ethanol. No modifications are required for the Internal Combustion Engines (ICE) for up to 10% ethanol blended petrol. However, for using petrol with a higher blending of ethanol the engine requires remapping.

While Groupe PSA is aiming to launch the flex-fuel engine car her, it must be wary of the available fuel quality and blend levels, say experts.

Also, ethanol production demands higher water usage. With rapidly decreasing groundwater levels across India, this could be a future problem if the policymakers don’t look at the issue.

What other product Groupe PSA is bringing to India

Groupe PSA owned Citroen will also bring the premium mid-size SUV C5 Aircross for the Indian market, which will hit the showrooms in 2021. Apart from that, an SUV is also on the card along with a compact SUV CC24, which would entre the market in 2022. This CC24 compact SUV will compete with rivals like Maruti Suzuki Vitara Brezza and Hyundai Venue. Besides that, a compact sedan is also on the card from the French auto giant.

The automaker is working on a mass-market small electric SUV, codenamed as eCC21. This small electric SUV could be priced around Rs 8 lakh and hit the Indian roads in 2022. The electric SUV will compete with Mahindra e-KUV100 and Tata HBX small SUV. Also, this EV will lock horns with another French electric car Kwid EV as well. With Maruti Suzuki working on WagonR EV, the small electric SUV will give it a competition.

Citroen has set a goal to sell 3,000 units of the electric car in India every year. Also, the automaker aims to sell 1 lakh cars in India by 2025.

Also Read: Social media influencers and automotive ads: A 50-50 marriage proposition?

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