New Delhi: The emerging opportunities in the electric vehicle space for innovative business models, battery chemistry mix, collaborations, and more importantly in the basics or 4Fs – Fundamentals, Factors, Future and Funding – were discussed by industry experts at the ETAuto virtual summit on ‘4F of EV Revolution’ on Wednesday.
The event witnessed the unveil of the ETAuto 2.0 website along with a report presentation titled ‘Accelerating Electrification: The Present and Future of the Electric Vehicle Industry in India’, in association with Nomura Research Institute (NRI).
Jyoti Malhotra, Managing Director, Volvo Car India shared that the demand for the company’s XC40 Recharge electric has been positive to an extent that Volvo is contemplating discontinuing its conventional ICE (internal combustion engine) model in the market.
In CY22, EV sales grew 206% over CY21. However, compared to the excitement in the e-2W and e-3W segments, sales growth in the e-PV segment is still slow. Most of the EV models on sale are conversions of ICE platform vehicles and are generally 30%- 40% more expensive than their ICE counterparts. The market is dominated by Tata Motors and MG Motor, with about 1,000 units sold in the luxury segment.
Gaurav Gupta, Chief Commercial Officer, MG Motor India, said, “In the ICE vehicles market, 85% cars are below the price of INR 15 lakh, whereas in the EV market, 75% cars are above INR 15 lakh. There is a need for affordable e-PVs with a good range.”
In the entry-level passenger vehicle segment, India offers Tata Tiago EV, and Citroen e-C3. SAIC-owned MG Motor will be launching its Comet EV next quarter, with prices expected to range between INR 10lakh and15 lakh.
On the customer concerns about EVs, Malhotra of Volvo said, “It is the fear of the unknown. Public charging infrastructure is slowly coming up and it will complement home charging.” He noted that there is a huge scope of PPP model for the setting up of EV charging infrastructure in India.
Battery and safety concerns
Reducing battery prices is the only way to make the EVs affordable. USD 80–100 per kWh is an often-stated benchmark for when EVs will reach price parity with ICE vehicles. Recent battery prices have failed to continue the downward trend that had been observed in the last decade. This stagnation is caused by several variables, but the cost of raw materials like cobalt, nickel, and lithium is by far the largest one.
Ashim Sharma, Senior Partner & Group Head Business Performance Improvement Consulting (Auto, Engg. & Logistics), NRI, said, “We need the chemist in-house more than the in-house materials to develop the technical know-how of creating batteries in the country, rather than depending on exports.”
Industry experts agreed that the incentives of the state and central governments for e-mobility including the ACC PLI and the FAME scheme have been effective. However, unlocking opportunities in this journey will require continuous collaboration between policy makers and industry players.
Inderveer Singh, Founder and CEO, Evage Ventures, said, “First, localisation of the supply chain is an important factor. Highly complex components are hard to find in India but that is not stopping the investments. Secondly, the FAME policy should continue to be implemented.”
The battery chemistry mix currently used in Indian EVs are a result of the evolving supply landscape and customer needs. This includes NMC, LFP and LTO.
In the past two years, the EV industry has seen a number of fire incidents on electric scooters, raising questions on the safety of these vehicles. The series of fires have also triggered concerns whether the manufacturers have introduced their products without adequate quality and safety checks.
Pamela Tikku, Chief Business officer, ICAT, said, “The Ministry of Heavy Industry has tried to bring standards to improve the safety aspect of the battery. Under the PLI scheme, the questions regarding the compliance of the FAME-II are addressed at a higher level. In PLI scheme, the approval scheme is becoming stringent. The government is focusing on the whole ecosystem in making the performance become robust.”
Confidence-building is also a focus and it will only happen when the person does not have to worry about his safety (while riding an EV), she said.
The report noted that the mass adoption of EVs can also complement the achievement of SDG goals (5/17) set by the United Nations and ratified by all member countries.
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