For decades, India’s automobile story has run on petrol, diesel and compressed natural gas. Then came electric vehicles, the industry’s new disruptors, promising cleaner mobility. Now, another contender is pulling into the fast lane: flex-fuel vehicles (FFVs), powered not just by petrol but also ethanol drawn from India’s vast agricultural economy.

In 2026, India is witnessing a slew of new car and two-wheeler launches that can run on up to 100% ethanol. Though work on FFVs had been going on for quite some time and some prototypes were showcased at Bharat Mobility Expo 2025, the West Asia crisis has hastened the shift as policymakers look to ensure energy security amid elevated crude oil prices. To kickstart the rollout of FFVs which can run on up to 100% ethanol, the ministry of road transport and highways in April included E100 (pure ethanol) in automobile testing and certification standards.

“Any product that could take anything above 85% ethanol could not have been classified as an FFV. That has been removed. It opens the possibility to E100 also,” says Vikram Gulati, Country Head & EVP, Corporate Affairs & Governance, Toyota Kirloskar Motor.

Even though the E20 fuel mandate has been a rushed affair, FFVs have industry backing. And the blueprint already exists—and it comes from Brazil, one of the world’s earliest and most successful adopters of FFVs.

With the introduction of FFVs, the government may not have to increase the base ethanol blending rate, says Gulati. “In Brazil, while the base blend remains E27, the average national blend has risen to as much as 50% with FFVs,” he says. FFVs account for around 90% of new car sales in Brazil, the world's second-largest producer of ethanol after the United States.

“In Brazil, the ethanol offtake after the introduction of FFVs was a J curve, as enablers were put in place. Consumers found economic rationale to use ethanol instead of their base blend,” says Gulati. With FFVs, concerns around corrosion and mileage loss get resolved, he says. “It’s a no-brainer solution for our country. It’s the best for all stakeholders: consumers, oil marketing companies, government, ethanol producers and automakers.” Flex-fuel engines can run on 100% ethanol. They automatically detect ethanol content and adjust performance.
 

THE INDIA STORY

In 2024, Honda Motorcycle & Scooter India launched the CB300F Flex Fuel motorbike that supports E85. Suzuki launched the Gixxer SF 250 at the Bharat Mobility Expo in 2025. TVS Motor Company and Bajaj Auto have also showcased flex-fuel motorcycle prototypes. Royal Enfield, the maker of Bullet and Classic motorbikes, is also readying its portfolio for higher ethanol blends.

“We have been exporting to Brazil for over 10 years,” says B Govindarajan, Managing Director of Eicher Motors Ltd and CEO of Royal Enfield. “We have one ready product, the Classic 350, with flex fuel compatibility. We are now looking at the rest of our product line. The moment the infrastructure is ready for FFVs, we will be ready with the products,” says Govindarajan.

Hero MotoCorp, the country’s largest two-wheeler manufacturer, launched its maiden flex-fuel vehicle on June 3—Hero HF Deluxe Flex Fuel and Hero Splendor Plus Flex Fuel. “Many OEMs are ready with the products. One can expect more announcements in the near future,” Harshavardhan Chitale, CEO of Hero MotoCorp, told Business Today in an interview.

FFVs can not only reduce CO2 emissions but also India’s dependence on fuel and battery cell imports. Only Ola Electric makes battery cells in India and that too for its own needs. EVs of all major brands have imported battery cells. “For energy resilience and clean mobility, we need to look at multiple sources, as electric vehicles have limitations due to dependence on one country (China). Hence, we are actively focusing on FFVs,” says Chitale.

The focus on FFVs also comes at a time when the share of electric vehicles in new two-wheeler sales has been stagnant around 7% over the past two years. “Our ability to ramp up FFVs is far higher than the ability to penetrate with electric mobility. For EVs, we need to solve many other ecosystem challenges, whereas with ethanol, the industry can move rapidly to FFVs. That is green from the cradle to grave and totally Atmanirbhar,” says Chitale.

For carmakers, too, the rollout timeline is months, says Toyota’s Gulati. “That’s the time one needs for testing and homologation certification,” he says. Toyota is currently running a flex fuel pilot with its strong hybrid multi-purpose vehicle, the Innova Hycross. Maruti Suzuki India Ltd launched the country’s first flex-fuel car—a Wagon R—that can run on up to 100% ethanol on June 4. “There are three pillars which if come together can just help FFVs take off in a big way. The car, the fuel distribution network and the price of ethanol with respect to petrol. The first two are being worked upon and the third is possible at least partially immediately,” says Rahul Bharti, Senior Executive Officer, Corporate Affairs, Maruti Suzuki.

Tata Motors Passenger Vehicles is targeting the launch of its maiden FFV by early next year. “We are very comfortable in terms of technology readiness. We should be ready with at least one product by the end of this year or early next year,” says Shailesh Chandra, MD and CEO, Tata Motors Passenger Vehicles.

Renault, too, is ready to drive in FFVs in the country. “We are fully ready. In Brazil, we have been selling FFVs for over 15 years,” says Francisco Hidalgo, vice president of sales and marketing at Renault India.
 

WILL BUYERS TAKE THE DEAL?

The E20 fuel rollout has already drawn criticism from car owners over lack of an E10 fuel option. Convincing car buyers who are already wary of loss of mileage from ethanol will be a herculean task.

Several industry experts told Business Today that E85 needs to be at least 30% cheaper than conventional petrol to make economic sense for consumers as ethanol contains roughly one-third less energy than petrol. In its recommendations to the government five years ago, the Society of Indian Automobile Manufacturers (SIAM) suggested that E100 can work only when it costs 30% less than gasoline.

Currently, the price difference between E20 and E85 is roughly about 20%, making it less attractive for flex-fuel vehicle buyers. E85, which was introduced at select fuel pumps in Delhi, costs Rs 82 per litre compared with Rs 102.12 per litre for E20 petrol.

The industry is asking for policy enablers to encourage consumers to adopt these vehicles, says Toyota’s Gulati. “From a customer perspective, the technology has to make sense from the point of view of total cost of ownership, just like in the case of battery electric,” he says.

Gulati highlights two immediate challenges: higher upfront cost and loss of mileage. “FFVs cost about Rs 50,000 more than a conventional ICE car. With the same GST and road tax rates, the price difference is compounded,” he says.

Maruti Suzuki’s recently launched flex-fuel car, the WagonR Bioflex, is priced at Rs 7,23,900 (ex-showroom). It costs Rs 85,000 more than a comparable petrol car. However, the difference is not much in the case of two-wheelers. Hero MotoCorp's flex-fuel vehicles cost only about 4% more than conventional petrol models.

The second challenge is operations. “There is a loss of mileage as ethanol has lower energy density. The price of ethanol must be much less than the price of petrol,” says Gulati.

Without a meaningful price advantage over petrol, the trade-off in mileage could make consumers hesitant to switch. “It may end up punishing a consumer for buying a cleaner technology than petrol,” Gulati says.

There is also the question of infrastructure such as dispensing machines. The draft CAFE III norms have slashed super-credits on FFVs from 1.5 to 1.1. These remain below strong hybrids, which get 1.6, and electric vehicles, which get 3. Super credits are regulatory multipliers that allow automakers to artificially inflate sales volume of clean, low-emission vehicles when calculating their overall fleet-wide emissions.

“The fleet emission norms must recognise the potential and contribution of ethanol as not only 100% replacement for petrol but also carbon neutral. If this is not done, it will be very difficult for OEMs to introduce FFVs,” says Gulati. OEMs and the government are talking on all these enablers, he adds.

FFVs are unlikely to generate significant volumes in the near term due to limited availability of models and need for a nationwide network of dispensing pumps, Maruti Suzuki’s Bharti told analysts during the company’s Q4 FY26 earnings call. “We need more models. We need energy-based parity between ethanol and petrol prices. It is a futuristic plan. The volumes will be minimal at this stage. They will grow, say, five years to 10 years from now,” he says.

For consumers, E100 vehicles could cost 3–8% more due to ethanol-resistant components, while higher fuel consumption may offset savings from cheaper ethanol, says Ravi G Bhatia, President & Director of JATO Dynamics India. Bhatia, however, warns that a premature push towards E100 could strain automakers’ capital allocation and potentially slow EV adoption by diverting investments and policy focus.

On the other hand, Hero’s Chitale is all for increasing the biofuel content in the energy mix. “That is a sure shot way to make ourselves ‘self-reliant’. We are all for it, whether it comes through E25 or it through a rapid shift to E85 and E100,” says Chitale.

The debate around India’s clean mobility transition, say industry leaders, cannot be reduced to a single technology. By 2030, India’s car market is expected to swell to nearly six million vehicles annually. Even in the most optimistic scenario, EV penetration may reach only about 20%. That still leaves nearly 4.8 million ICE cars.

As millions of new ICE vehicles continue to enter Indian roads through the decade, the country’s dependence on imported fossil fuels could deepen instead of coming down. The International Energy Agency has already flagged India as a major driver of future fossil fuel demand growth, projecting that more than one-third of global oil demand growth could come from the country.

“This scenario is going to be disastrous not only for the environment but also the economy. The CAD is going to go through the roof,” reckons Toyota’s Gulati. “If you go electric, you are increasing the import bill for EV parts. That is going to reduce when indigenisation happens. But that too is going to take some time,” he adds.

There is no doubt that FFVs will increase the offtake of ethanol, leading to better incomes for farmers. But only time will tell if it works in India. While people can sit in their drawing rooms and wish for energy transition, it is ultimately the consumer who has to make it happen.
 

@karandhar