The Future Of Electric Vehicles In India

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  • 19 Apr 2023

'Papa ki kara? Petrol khatam hi nahi honda'. Remember this unforgettable kid saying in a TV ad? To appeal to mileage and fuel-conscious nation an auto company came up with this ad a few years ago. But the times have now changed…

The focus has now shifted from ‘petrol-diesel’ to 'electric-digital'. And with this, a lot will change in the auto sector. That's because, unlike an internal combustion engine vehicle, electric vehicles (EVs) will run on very few moving parts.

Remember when mobile phones disrupted landlines? It was not just about talking on the go. It completely changed our lives with music, entertainment, information, work, shopping. The auto segment is going through a similar revolution. The EVs are coming along with an IoT revolution.

Think about it. The future cars will be connected and digital. From vehicle ownership to shared cars, safety, connectivity, location tracking vehicle condition, infotainment... the electric vehicle in the future be very different from the ones we drive today.

The government is expecting electric vehicle penetration to reach 40% in the two-wheelers and cars segment and close to 100% for buses by 2030.

Time will tell, whether the plan can be executed well. For its not just the manufacturing of electric vehicles that is critical. We also need the necessary EV ecosystem including charging infrastructure to support the plan. Lack of sufficient charging points is one of the primary reasons why customers often refrain from purchasing EVs along with their high price currently.

Let's assume that India manages to put in place the infrastructure to support electric mobility, the feasibility of the plan still hinges on the availability and the cost of batteries. However, battery prices are expected to come down sharply in the future which will make EVs affordable and may help in faster penetration after 2-3 years.

Several measures have been put in place to facilitate the adoption of electric mobility. The government has been rolling out incentives in the form of lower taxes and subsidies to boost EV market demand. Then there are PLI schemes to localize the production of key components like battery storage as well as electric vehicles and auto components. Besides, several Indian states have now passed EV policies intending to attract industry investments.

The majority of existing automakers in the two-wheeler, three-wheeler, bus, and passenger vehicle segments are delving into the electric vehicle space. Tapping the opportunity, players like OLA Electric, Ather Energy, and many others are rapidly growing their presence. Further, Greaves Cotton and Sterling and Wilson also announced their entry into this space. Recently, the American company – Tesla Inc. marked its entry into India.

What The Future Holds?

Regardless of the country’s ambitious targets, India’s EV space is at a nascent stage. However, looking at it differently – India offers a largely untapped market. Electric vehicles are very much on their way to invading Indian roads. The threat of disruption in this era is something you cannot ignore. It will be interesting to see which existing companies survive and which new players enter the EV world that will have us write a blog that says - The country with one of the world's largest number of vehicles uses no petrol or diesel!

References:

These stocks may stand to benefit from India’s growing electric vehicle market

Electric Vehicle Industry in India: Why Foreign Investors Should Pay Attention

Govt wants EV sales penetration of 30% for private cars by 2030

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