India’s electric vehicle industry is booming; the government has launched schemes and incentives to promote electric mobility. They have also stated that there should be at least one charging station in a grid of 3km x 3km in cities and one every 25km on highways. The country has accepted that environmental development can be pursued without compromising economic growth. This can be seen in the latest EV sales statistics.
According to an independent study conducted by the Centre for Energy Finance (CEF), the EV market will be at $206 billion by 2030. This target would require a $180 billion investment in production and infrastructure. India sold 143 000 units of EVs in the period 2018 – 2019, with over 97% of these sales being two-wheeler vehicles.
More charging stations are also needed; even though there are policies and frameworks in place to improve this, the charging stations should be increased at the rate people buy the vehicles. It would also be beneficial for the government to look at installing these charging stations at places people frequent and stay for a while, like a mall, hotels, a casino, or a school.
Reportedly Ola Electric has been one of the companies that have benefitted from the demand for electric two-wheeler vehicles. In a two-day purchase window, the company is reported to have made over $149 million in electric scooter sales. These scooters are produced locally at the company’s factory in Tamil Nadu. Locals will have more employment opportunities if the November 1st sales window period is anything like this one. Those that have predicted that electric vehicles would revive the economy were correct.
Reasons to buy/lease an electric vehicle
- You are part of the fight against global warming, contributing to preserving the environment with less pollution and zero gas emissions.
- You will also be glad to know there are tax benefits. If your company purchases an electric vehicle, you can get a rebate of 40% depreciation in the first year.
- Electric vehicles offer a better driving experience, and there is no manual transmission, so you just have to brake, accelerate and steer. This reduces driver fatigue and stress.
The country still has some issues to fix before electric vehicles are the conventional method of transportation in the country. One of these is the production of batteries and car parts within the country. India imports a lot of battery parts and charging infrastructure. The government should focus on producing these locally, which would lower the car price.
The Current EV Market in India
India has set itself a very tough target for EV adoption, but India’s electric vehicle sector is still in its developing phase. But from another perspective, India offers the largest undeveloped market in the world, especially in the two-wheeler segment. Thanks to automated routes, the department allows 100% foreign direct investment. Tesla Inc., an American electric vehicle and clean energy company, recently entered India when its subsidiaries Tesla India Motors and Energy Pvt Ltd in Bangalore merged. India’s first luxury electric vehicle manufacturer, Ather Energy, moved its $86.5 million factories from Bangalore, Karnataka, and Tamil Nadu at the beginning of this year. The annual production capacity of the Ather Energy plant is more than 1 lakh motorcycles.
CO2 emissions per kilometer will be lower in an electric car compared to an ICE car in 2030
KEY FINDINGS
- Indian automotive industry can produce a 5.7 percent higher value add in a 30 percent electric car sales scenario than in a business-as-usual (BAU) scenario with limited electric car penetration.
- Limited indigenization of powertrain and battery pack assembly will lead to an 8 percent lower value addition from car manufacturing in 2030 as compared to BAU.
- An EV transition can generate a higher value add than BAU if both, powertrain components and battery pack assembly, are highly indigenized.
- A 30 percent electric car scenario will support around 20 to 25 percent fewer jobs as compared to BAU depending on the level of indigenization.
- The new EV jobs will require a trained workforce which does not exist in India today. Reskilling and vocational training will be critical to achieving the EV sales target.
- Importing battery cells for electric cars will be cheaper than importing the oil needed for internal combustion engine (ICE) cars in 2030.
- CO2 emissions per electric car will be 2 to 16 percent lower in 2030 (depending on renewable energy penetration in the grid), highlighting the environmental case for an EV transition in India.
Electric vehicles are any nation’s future transportation committed to reducing its carbon footprint. Even if they run on electricity produced by fossil fuels, they are still more efficient and pollute 70% less than conventional vehicles. They are also easier to maintain than vehicles with IC engines.
India has shown it is genuinely committed to its fight against global warming. The next step is to reduce its reliance on fossil fuels for electricity generation. We hope other countries with developing economies like India will follow suit.