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Concentrated efforts from the government and other stakeholders will boost the supply and demand of electric vehicles (EVs) and subsequently drive the adoption of the EVs in India, says GlobalData, a leading research and analytics company.
Bakar Sadik Agwan, Senior Automotive Consultant at GlobalData, comments: “The latest developments in the automotive industry indicate that EVs are now on a fast track in India and that the market holds significant growth potential. All key stakeholders in the industry, including the government, energy companies, OEMs/automakers, component manufacturers, insurance companies and new mobility companies are increasing their offerings and preparing to capitalize the opportunities in the EV space.”
Indian central and state governments have been introducing conducive policies to boost FDI in EVs and create new manufacturing hubs. State governments are also leading by example by increasing their EV fleets and lure customers with incentives. The government has also sanctioned new charging stations across states under FAME II scheme and the guidelines from the oil ministry (MoPNG) regarding the installation of EV charging stations at new fuel pumps.
EVs are now strategic priority for auto OEMs and they are focused on bringing in new products with increased investments in R&D and partnerships. Currently, the Indian market has a wide range of EV two-wheelers from all major OEMs.
Passenger vehicle segment includes EVs from several OEMs including Tata Motors, Mahindra & Mahindra, Hyundai, MG Motors and Mercedes. The market has also witnessed new players such as OLA, Tesla and Triton entering EV manufacturing in India.
Other stakeholders such as component manufacturers are also gearing up to serve the evolving needs of the OEMs. Latest example is JK Tyre’s latest partnership with JBM Auto for E-Bus tyres. With growing EV sales, insurance companies are also getting ready with dedicated insurance cover for EVs. Insurance Regulatory & Development Authority of India (IRDAI) has announced plans to incentivise EV insurance with 15% discount by insurers.
Another major area, which has emerged as key end user of electric vehicle is the shared mobility, which has been an early adopter of EVs. Due to COVID-19, there has been a substantial growth in the demand for e-commerce and delivery businesses.
Mr Agwan continues: “EVs are a strong fit for last-mile delivery businesses as they have a direct impact on the bottom-line. E-commerce giants Amazon and Flipkart have indicated their commitment to 100% electric mobility in their logistics fleet and new start-ups such as eBikeGo, Oye! Rickshaw and moEVing are also focusing on complete electric mobility.”
Electrification of shared mobility is a win-win in the Indian context. With low total cost of ownership, easy asset leasing partnerships and various other benefits over ICE vehicles shared mobility is expected to emerge as major driver for EV adoption in near future.
Mr Agwan concludes: “The collaborative efforts from all stakeholders are laying foundation for a better EV ecosystem that will result in increased acceptance. However, customer challenges such as high costs, range anxiety and charging infrastructure along with more attractive incentives are needed to lure price conscious Indian customers.”