India Electric Vehicle Market – An Ecologically Friendly Choice

Posted in Automobile by Adolf on Dec 3,2022 644

With rising pollution levels and the cost of fossil fuels, many countries are adopting green energy, and India is no exception. Rapid technological improvements in the areas of battery capacity enhancement, increasing affordability, more comfort, more battery range, less charging time, less maintenance and a contribution to pollution management are all factors contributing to the India electric vehicle market growth. Lithium-ion batteries are fast gaining popularity because they offer more benefits over lead-acid batteries in terms of energy density, thereby offering greater range and faster charging time.

Due to rising oil prices and urban pollution, a move towards the adoption of green energy can be seen in India. The country's shift toward electric mobility in the passenger vehicle sector could save up to US$300 billion in oil imports and nearly one gigaton of CO2 emissions by 2030. The government is promoting green energy by increasing environmental consciousness and focusing on cost-effective transportation.

Also, the government is prioritizing the shift toward clean mobility and faster adoption and manufacturing of electric vehicles under the FAME II scheme in India, making them more affordable. The two-wheeler segment holds the dominance in the electric vehicle market as many youngsters opt for electric two-wheelers for their daily needs and city ride. Also, COVID- 19 has helped the popularity of electric vehicles among customers at a gradual pace. The low cost of running the three-wheeler segment is rapidly increasing its sales. Many new players are emerging with their wide range of products which helps in market competitiveness. Under the Paris Climate Agreement, the Indian government endorses renewable and non-polluting forms of producing electricity.

India electric Vehicle Market is expected to grow from US$5.15 billion in 2022 to US$14.91 billion in 2028, growing with a CAGR of 19.81% in the forecast period. India is heading towards rapid adoption of green energy through various government initiatives, subsidies which in turn escalates sales of electric vehicles across the country to drive the India electric vehicle market in the upcoming years.

The India electric vehicle market is segmented based on, by vehicle type, by propulsion, by battery capacity, by range, by charging time, by region, and by company. On the basis of vehicle type the market is segmented into passenger cars, LCV, M&HCV, two-wheelers, and three-wheeler. Furthermore, by passenger car into SUV/MPV, sedan, hatchback, by LCV into van and pickup truck, by M&HCV into buses and truck, by two-wheeler type into scooter/moped, motorcycle, by three-wheeler type into pickup and passenger carrier.

Given the economic viability in terms of price and fuel economy, two-wheelers account for the largest share of the EV market. At present, electric four-wheelers have very low penetration in the EV market due to high upfront costs, low battery life, underdeveloped charging ecosystem, and import-based infrastructure.

Electric vehicles are divided into four segments based on propulsion: BEV, HEV, PHEV, and FCEV. BEV, which is fully dependent on the battery, is gaining more popularity due to its zero emission. HEVs are powered by an internal combustion engine with one or more electric motors that use energy stored in batteries that cannot be charged separately.

In PHEV, electric vehicles can use battery-powered motors and IC engines independently to run the vehicle. FCEVs, which are more efficient and produce no emissions than conventional IC engines, are powered by hydrogen. The demand for electric vehicles is increasing rapidly, owing to the increasing shift towards advanced technology and multiple government initiatives in India. Many companies emerge with their advanced technology and innovative product range keeping the budget-friendly cost of the vehicle. Moreover, companies such as Olectra, Mahindra & Mahindra, JBM Auto, and Ather are developing not only electric vehicles but are also concentrating on the expansion of EV infrastructure development for the market.

Some of the major players which are leading in India electric vehicle market are Tata Motors Limited, MG Motor India Private Limited, Mahindra & Mahindra Limited, PMI Electro Mobility Solutions Private Limited, JBM Auto Ltd., Hero Electric Vehicles Pvt. Ltd., Okinawa Autotech Pvt. Ltd., Greaves Electric Mobility Private Limited, YC Electric Vehicle, Saera Electric Auto Pvt. Ltd. Many new players are emerging with their technology and increasing competition in market.

These players are investing in research and development, innovations to provide wide range of products. Tata motors limited with its strong presence dominates in passenger car segment. In LCV, Mahindra & Mahindra Limited has largest share. The M&HCV segment was led by PMI Electro Mobility Solutions Private Limited and followed by Tata Motors Limited. With large distribution network coupled with brand awareness Hero Electric Vehicles Pvt. Ltd. captures around 1/3rd market of electric two wheelers. In three-wheelers, YC Electric Vehicle comes on top followed by Saera Electric Auto Pvt. Ltd.

The future for EV market in the country is expected to develop at a fast rate. The government has reduced the GST on EVs to 5% to make them more affordable and will provide capital grants to organizations – such as delivery companies and e-commerce players – that promote EV adoption. It also approved the installation of more than 2,600 EV charging stations with the aim to provide charging facilities every 25 kms thus addressing range anxiety. The Union Budget 2022 – 23 also had several proposals for India’s EV landscape, such as inducing EV penetration in public transport and create special mobility zones for EVs.

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