BT Explainer: What are EREVs? Why JSW MG Motor may bring this tech to India next

JSW MG Motor India, which became the first mass market car manufacturer to introduce a plug-in hybrid vehicle (PHEV) in the country last week, could bring an extended-range electric vehicle (EREV) to India next.

Parth Jindal, who took the wheel at the SAIC Motor-backed automaker as Chairman, said last week that the company could bring an EREV to India next.

“We can even bring in REEV and HEV if we require,” Jindal told reporters on the sidelines of the MG Hector Tomahawk EV and PHEV launch.

What is an EREV?

An EREV is a car that is powered by a battery but also has a petrol engine. The car uses its battery to power the electric motor. When the battery starts running low, the petrol engine switches on to generate electricity and extend the car’s driving range. In simple terms, an EREV offers the electric driving experience of an EV while using petrol as a backup for longer journeys.

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How is it different from a PHEV?

In a plug-in hybrid vehicle (PHEV), the drivetrain can be powered by both an internal-combustion engine and an electric motor, depending on the driving conditions and the vehicle’s operating mode.

In an EREV, the only connection of the drivetrain is with the battery. “The engine is a backup generator. In the event, your battery is running out of charge, the generator kicks in to charge the battery, but the car is being driven by the battery,” Jindal explained.

The tax debate

While EVs in India attract 5% GST, a plug-in hybrid vehicle or PHEV is taxed at 40%. “There is 40% GST on PHEVs. It’s not 5% like EVs. We would have loved to price it even better but because it is at 40%, our hands are tied,” Jindal said, comparing the prices of the Hector Tomahawk PHEV and Hector Tomahawk EV.

The Hector Tomahawk EV with 69.2 kWh battery pack and a claimed range of 517 km is priced starting from Rs 19.49 lakh (ex-showroom). In comparison, the Hector Tomahawk PHEV's price starts from Rs 25,69,800.

“The only difference between pricing of PHEV and EV is the tax. We could have launched PHEV at the same price as EV,” said Jindal. “A plug-in hybrid is a new energy vehicle (NEV) because majority of the time the consumer will be using the car on EV mode. It is very rarely that the engine will be required. That should get differential tax treatment,” he said, adding that while he would like to see a tax reduction for PHEVs.

Jindal, however, expects the government to tax EREVs on par with EVs. “In my view and in NITI Aayog’s recommendation to the government, EREV should be considered as an EV,” he said. “We are hopeful that this is how it gets classified from a taxation point of view,” Jindal added.