How electric vehicle manufacturers anticipate a multiple-fold increase in demand in India?
The need for mobility between places, whether for work, leisure or mere convenience, has disrupted the mobility industry. Albeit being hit by the worst pandemic ever, the human need to step out has not diminished at all, rather has increased multifold – steering way for electric vehicle manufacturers in the country.
India is amongst the most populated countries in the world, which has a huge appetite for motor vehicles. However, with great demand comes a great price to pay. And, today, India is evidently driven by major issues, including climate change, environmental pollution, congestion, safety and energy security. If the status quo continues, mobility problems will intensify as population and GDP growth will further push the demand for motor vehicle ownership. Amidst this, the mobility industry is tapping on the opportunity to transform the way we fundamentally move by leveraging changing consumer behaviour, regulations and technology.
The Golden Opportunity for EV Sector
Over the last couple of years, the Indian electric vehicle industry has slowly gained momentum – supported by government initiatives and consumer awareness. At present, EVs account for nearly 1% of total vehicle sales in India. And, as per the ‘Society of Indian Automobile Manufacture’, it is projected that by 2030 it will increase to around 30%.
Government Initiatives: The Indian Government has laid down the roadmap to accelerate the production and use of EVs in the country in light of national fuel security. Various initiatives, schemes and policies, such as Faster Adoption & Manufacturing of Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India, Electric Vehicles (FAME), National Electric Mobility Mission Plan and Battery Swapping Policy, among others, are playing an instrumental role in the growth of the e-mobility industry. These initiatives have opened avenues to set up an EV manufacturing ecosystem and build a comprehensive EV infrastructure. To further adoption and ease transition among consumers, the government has introduced tax exemption on the purchase of two-wheeler or four-wheeler electric vehicles on loan.
Consumer Behaviour: The rising fuel prices have guided consumers’ intents. They are keenly interested in how much would they save by switching to an electric vehicle from an ICE vehicle as the fuel prices are always on the higher side. Moreover, consumers have become aware of sustainable mobility modes and have started steadily investing in alternate options. The trends also suggest a rise in interest among the young Indian masses for electric vehicles for they run on innovation, sustainability and environmental conservation.
Technology: Electric Vehicles have been riding on Indian roads since the 1990s, and yet, they started to gain popularity in the last decade. Technological limitations, including low miles coverage in a single charge, poor charging infrastructure and outdated charging methods, had affected the adoption of EVs. However, with the recent advancement in technology, along with government-led initiatives, consumers are shifting to sustainable mobility. Now, the companies are offering a combination of better battery technology, charger performance and charging infrastructure – reducing downtime along the road.
What lies ahead?
The mobility industry is at a crucial point in its history with the market and consumer sentiments toward electric vehicles being principally positive. While over a total of 3,30,000 two-wheeler and three-wheeler EV units were sold in 2021, according to the IVCA-EY-IndusLaw report, the industry registered a 168% growth over 2020. Further, the report also suggested that this number will achieve the 90 lakh mark by 2027 because of favourable regulations and growing EV infrastructure.
Looking at the mindset and demand shift towards EVs, electric vehicle manufacturers are anticipating the current market scenario to be the beginning of a steady climb. Moreover, EVs have become a mainstream choice for mobility in the last decade and will share a much larger chunk of the mobility sector in the foreseeable future – as the manufacturers are aggressively getting ready for new product launches.
(The author is Mr. Tushar Chhabhaya, Director, Aarya Automobile and the views expressed in this article are his own)
