Electric vehicles in India have opened ample business opportunities for automobile companies within the country and across the globe. Ahlam Rais brings you the latest insights of this trending market.
Does India plan to have all electric vehicles (EVs) by 2030? This question has been in the limelight for quite some time and the answer is No, the target is way too ambitious. Even with high investments, state policies and incentives, industry stalwarts explain that India still has a long way to go. Dr. Pawan Goenka, Managing Director, Mahindra & Mahindra in a recent summit revealed, “In terms of EV connectivity, Norway has 22 %, China has 2 % and India has only .02 %. For us to talk about full connectivity by 2030 is perhaps too ambitious but 20 % by 2030 is a realistic target.” Agreeing with him, Nirmal K Minda, President, Automotive Component Manufacturers Association of India said, “Even if we are able to deliver 30-40 % it will be an achievement.” The Indian automobile industry is ready to take on the challenge in order to achieve these figures.
Indian Government’s initiatives for electric vehicles
In 2013, the Government of India launched the National Electric Mobility Mission Plan (NEMMP) 2020. The plan aims to achieve national fuel security by promoting hybrid and electric vehicles in the country. To fast track this development, the government also launched the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles scheme under NEMMP 2020.
This scheme is aimed at incentivising all vehicle segments i.e. 2 wheeler, 3 wheeler auto, passenger 4 wheeler vehicle, light commercial vehicles and buses. Under this scheme, about 99,000 hybrid/electric vehicles (xEVs) have been given direct support by way of demand incentives since the launch on April 1, 2015. The government has also approved pilot projects, charging infrastructure projects and technological development projects aggregating to nearly 24 million dollars.
Goenka added that in India, the first usable EV will happen through aggregators, fleet operators such as Ola and Uber, corporate fleets and so on. This is where we will see the highest number of EVs and will be the biggest bank for the buck. In phase two, personal use of EVs will take place once they become more affordable.
Business in electric vehicles (EV)
Goenka remarked, “Today, EV is one of the biggest opportunities that we have in India.” This holds true as business in this sector seems to be on the rise. Last year, EESL (Energy Efficiency Services), an energy service company of the government floated tenders to procure at least 10,000 electric cars to phase out government vehicles in New Delhi. The tender was awarded to leading automobile players Tata Motors and Mahindra & Mahindra. This year, the company will again float a tender for 10,000 more electric vehicles in India.
Taking advantage of the market scenario, the Mahindra Group, one of the leading Indian multinational car manufacturing corporations and the first EV manufacturer in India is actively involved in the development of electric vehicles. The firm has recently announced that it has plans to invest 140 million dollars in EVs over the next four years. Mahindra has already invested 92 million dollars in EVs over the past five-six years.
The South Korean carmaker Hyundai Motor Co. is also expected to be the first global automaker to introduce an electric vehicle in India by 2019. The company has also announced investment plans worth $1 billion in the Indian market. Similarly, Suzuki-Toyota also intends to come up with their first EV in 2020. The luxury car maker, Porsche is also set to launch its electric vehicle in India in early 2020. Many other players are also expected to tap this segment in the years to come.
Lithium ion batteries
EVs function on lithium ion batteries which are costly as it has to be imported. Experts explain that about 80 % of the core components including the battery and the battery management system in an EV are imported by domestic players. In the long run, India seems to have a solution to the problem, AS Kiran Kumar, Former Chairman of Indian Space Research Organisation (ISRO) in another business event mentioned, “As EVs are expected to enter the market in the near future, we at ISRO (Indian Space Research Organisation) have developed the lithium ion battery technology which involves more than 26 processes. Today, we are making use of these batteries for launch vehicles as well as for satellites. However, a large amount of work still needs to be done to make it available for the automotive industry.” Once the batteries are made locally it will further reduce the price of these vehicles. Charging stations are also being planned and set up across the country.
India is changing and with the advent of numerous new technologies and innovations in the EV space numerous opportunities are on the rise!