To encourage efficient consumption of energy, India has adopted energy consumption labels for electrical equipment and is now considering the introduction of fuel efficiency labels for cars. By means of a Discrete Choice Experiment (DCE), this paper assesses consumer preferences for fuel efficiency labels in New Delhi. A novelty of this study is that half of the respondents are treated by informing them that an environmental regulation would impose restrictions on the number of days cars can ply with the exception of highly efficient labeled cars which would be allowed to ply every day. An additional novelty of this study is that, in order to deepen our understanding on why people prefer cars that are labeled as fuel efficient, we take into account behavioural motives, which we divide into intrinsic motivation, environmental knowledge, extrinsic motivation (social network) and social interaction. We report results of latent class logit model and random parameter logit model. The classes in the latent class model are classified based on respondent's socio-economic characteristics and behavioural motives. The results show that on average, respondents are willing to pay more for the highly efficient labeled car under both control and incentive treatment, however, the willingness to pay for highly efficient labeled car is much higher under the incentive treatment.