New Delhi [India], July 23 : India's automobile industry, the world's third largest, could reduce its manufacturing emissions by up to 87 per cent by 2050 through a transition to green electricity and low-carbon steel, noted a report by the Council on Energy, Environment and Water (CEEW).
The report also highlights that most of the sector's emissions come not from direct manufacturing but from its upstream supply chains, especially from coal-intensive steel and rubber production.
"India's auto industry stands at a turning point. To lead in a low-carbon global economy, we must decarbonise not just the vehicles we drive but the industrial processes that build them. Automakers must clean up how their vehicles are made, what powers their factories, and how their suppliers produce critical inputs like steel and rubber," said Arunabha Ghosh, CEO, CEEW, said.
Several major automakers, including Mahindra & Mahindra, Tata Motors, and Toyota, are already advancing electric vehicle (EV) production and committing to net-zero targets under the Science-Based Targets initiative (SBTi).
However, the report warns that decarbonising the vehicle manufacturing process, especially Scope 3 emissions, must become a core strategy. These indirect emissions currently account for over 83 per cent of the sector's total footprint.
The study projects that without further intervention, vehicle production in India could quadruple by 2050, with emissions doubling to 64 million tonnes of CO2. Even as emissions per vehicle drop, the total carbon output would rise significantly unless cleaner materials and energy sources are adopted. For example, shifting to hydrogen-based steel production and using more recycled steel could alone reduce emissions by nearly 38 million tonnes.
CEEW recommends that original equipment manufacturers (OEMs) shift to 100 per cent renewable electricity and that suppliers transition to green technologies. In a net-zero scenario, such measures could cut annual emissions to just 9 MtCO2 by 2050. The think tank also stresses the need for policy support and corporate procurement commitments to stimulate demand for green materials at scale.
While hybrid vehicles can reduce short-term emissions, the study concludes that they are not a long-term solution and must give way to fully electric models. Ultimately, a two-pronged strategy, rapid EV adoption and full supply chain decarbonisation, is essential to align India's auto industry with a 2050 net-zero goal.
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