Though the total number of registered EVs in India stood at only half a million by the end of March 2020, experts expect the cumulative EV sales in all vehicle segments could cross over 100 million units by FY30, 200 times its current market size.
The electric vehicle (EV) market is experiencing a rising popularity as consumers move towards making more eco-friendly decisions and policymakers drive the automotive market toward low-carbon options and improved fuel efficiency. While the Covid-19 pandemic may have put a spanner in the works, it has only managed to slowdown what is turning out to be global move towards EVs.
According to a report by Bloomberg, there will be over 500 different EV models available globally by 2022. Consumer choice and competitive pricing will be key to attracting new buyers to the market. The report also stated that by 2040, over half of all passenger vehicles sold will be electric, with markets like China and parts of Europe achieving much higher penetrations.
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India's electric vehicle market could be worth nearly USD 206 billion in the coming decade, if India were to achieve its 2030 electric vehicle (EV) ambitions, according to a study by CEEW Centre for Energy Finance (CEEW-CEF). Citing NITI Aayog's target, the CEEW-CEF study said India's 2030 EV ambition "states that 70 per cent of all commercial cars, 30 per cent of private cars, 40 per cent of buses, and 80 per cent of two-wheeler (2W) and three-wheeler (3W) sales in 2030 would be electric".
However the covid-19 pandemic seemed to have slowed things down a bit for India.
According to a report by Hyundai, passenger car sales in India was around 2.5 million last year. Out of this, only around 3,500 units were EVS. Even if the market continues to grow to 4 million units in the next three years, Hyundai expects actual sales of EVs to be less than 40,000 units or 1 percent.
But other experts are far more positive.
Arvind Kakru, Country Head, Rockwell Automation, told Moneycontrol, "Innovative projects were announced in the last 6-8 months of the pandemic, something we haven’t witnessed before. The investor contribution is likely to flow down in this direction, and things will move forward aggressively.”
One of the factors crucial to realising India’s EV ambitions, the CEEW study stated, was battery Capacity. The report estimated an annual battery capacity of 158 GWh by FY30, thereby presenting a massive market opportunity for domestic manufacturers. Another issue plaguing the Indian EV story is the lack of charging infrastructure. Here the Indian government’s announcement of a PLI scheme for battery storage goods, to increase EV production will play a huge role. In 2019-20, India imported 450 million units of lithium batteries (used in a range of electrical equipment, products and EVs) valued at $929.26 million. However with an indigenous boost to battery production will help rapidly build capacity and lower costs.
The recent announcement by Ola Electric about its massive charging network exclusively for electric two-wheelers called the Ola Hypercharger Network also comes as good news.
The charging network is for its upcoming electric two-wheelers; the first of which will be a scooter to be launched in a few months. Claimed to be the world’s largest electric two-wheeler charging network, the Hypercharger will be spread over 400 cities and be the fastest two-wheeler charging network.
According to SMEV Chief, Sohinder Gill, a strong bank finance mechanism for EVs is also a crucial factor towards encouraging EV adoption in the country. Only banks like State Bank of India and Axis, to name a few, offer loans on selected models. The government should urge banks to offer loans on EVs, which will augment sales. There also needs to be greater awareness about green vehicles. The Central and state governments can play a crucial role in motivating and encouraging citizens to adopt e-vehicles. "We have seen in the case of Delhi wherein the state government is doing a tremendous job in creating awareness, which has encouraged more people to adopt EVs,” he told News 18.
In short, though the end of March 2020 the total number of registered EVs in India stood at only half a million, but experts expect the cumulative EV sales in all vehicle segments could cross over 100 million units by FY30, 200 times its current market size. It’s all about playing the long game in India.