Future is green: 2020 may see re-birth of electric vehicles, say experts

The year 2019 was a mix of ups and downs for the electric vehicle (EV) sales in the country. The coming year is expected to be better, with the entry of more electric cars and Chinese entities’ entry, bringing down the average cost.

The second phase of the Rs 10,000-crore scheme of the central government, termed Faster Adoption and Manufacturing for Hybrid and Electric vehicles (FAME II), offers higher incentives to higher powered products. It excludes lead acid battery-powered two-wheelers and mandates that e-scooters should have 80 km per charge and a minimum top speed of 40 kmph, with at least 50 per cent localisation in manufacturing. This has left a large share of two-wheelers out of the incentive, says CRISIL Research.

Recently, Union minister Prakash Javadekar told Parliament about 285,000 buyers of electric/hybrid vehicles had been supported by a subsidy of Rs 360 crore under FAME.

Sohinder Gill, director-general, Society of Manufacturers of Electric Vehicles (SMEV). said, “The year 2019 was full of turmoil for the EV industry. Sudden policy shock by the government in March 2019 led to a decline in sales of electric two-wheelers under FAME II. It has made companies becoming less dependent on government subsidies.”

The number of electric two-wheelers sold under FAME in the first six months of this financial year (April to September) saw a 94 per cent decline to around 3,000 units, from 48,671 units in the same period last year. The number sold without FAME incentive in the period went up to around 49,000 units, 2019, from around 10,000 during the same period last year, said SMEV.

Low-speed lithium battery vehicles without the FAME incentive cost around Rs 55,000. The high-speed electric two-wheeler costs around Rs 80,000 after the incentive applied, said sources.

The number of electric cars within the FAME scheme of under Rs 15 lakh cap sold during April to September almost halved to 340. They do not include the numbers of Hyundai's Kona, launched in July, according to the Society. Reports say only around 1,500 electric cars for personal use have been sold so far during the financial year.

Some of the positive developments were entry of leading players into the EV business, state governments announcing policies and customers becoming more aware of the benefits of such vehicles.

The goods and services tax (GST) for EVs was cut from 12 per cent to five per cent in July. The GST rate on charger or charging stations for EVs was also reduced from 18 per cent to 5 per cent. The central government also announced additional income tax deduction of Rs 1.5 lakh on interest paid on a loan to buy an EV, apart from duty exemptions for some parts.

2020

“In 2020, we might see the re-birth of electric cars, with their positive image driving sales. It could become part of a customer’s lifestyle statement. Though the numbers could be less, the excitement among citizens would be more,” hoped Gill.

In the two-wheeler category, there was entry of Bajaj, TVS and Revolt in the market, hitherto driven by established players like Hero Electric and Ather. People could become more brand conscious.

The e-rickshaw market seems likely to remain dominated by the unorganised sector. Authentic players in the three-wheeler segment might partner with municipal bodies, battery manufacturers or fleet operators. It would be a test year for e-buses. “Overall, we anticipate the market to grow by 100 per cent,” said Gill.

BIS Research says the EV market is anticipated to grow at a compounded annual rate of 43.1 per cent, charging infrastructure at 42.4 per cent and the battery market at 60.1 per cent during the period from 2019 to 2030.

Future is green: 2020 may see re-birth of electric vehicles, say experts

“Despite the Indian automotive industry experiencing a sharp decline in FY19, the EV market is expected to continue to grow in the coming years. With the BS-VI (emission) norms becoming applicable from April 2020, EVs will become more price-competitive with conventionally fuelled vehicles, thus accelerating sales,” it added.

China auto sales sink 5.4% in November, market slides for second year

China's auto sales sank 5.4 per cent in November from a year earlier, putting the industry's biggest global market on track to shrink for a second year.

An industry group, the China Association of Automobile Manufacturers, said Tuesday drivers bought just over 2 million SUVs, sedans and minivans.

Sales for the 11 months through November were off 10.5 per cent from a year earlier.

Chinese auto sales have been slowing after years of double-digit growth that made the country the world's largest market by vehicle sales.

The slump is squeezing automakers that are under pressure to invest in electric vehicle development to meet government sales quotas.

Will launch EV in India by 2022 but Govt must build ecosystem: Renault

French auto major Renault on Wednesday said it will bring electric vehicle (EV) in India by 2022 but wants the government to aggressively develop ecosystem "before any forced" launches in the country.

Stating that India is still not equipped with the ecosytstem for EVs, Renault India Operations Country CEO and MD Venkatram Mamillapalle said launching EVs now and "having the cars in the garages makes no sense".

"We are venturing into EV space. You will definitely see something coming up by 2022, but before I say that we want to enter into the EV segment, the most important thing is the ecosystem," he told reporters here.

Mamillapalle said India is still not equipped with the ecosystem for EV cars, adding "launching EV cars even now in India is halo".

He further said, "Giving wrong promises that we will launch EV tomorrow and having the cars in the garages makes no sense".

Stressing on the need for infrastructure to support adoption of EVs, Mamillapalle said, "I am expecting that the government will work on the ecosystem and I am sure they are working on that. We need to see very aggressively the ecosystem getting developed before any forced EV launches in India".

At the moment, he said, "You can't travel from Mumbai to Delhi for sure on an EV and the day we have an ecosystem which can support such a travel that's the time EV in India is ready".

There has been a lot of debate on future of electric mobility in India with government think tank Niti Aayog pushing for it.

Currently, Tata Motors offers its Tigor EV, while Mahindra & Mahindra has Verito electric sedan in the mass segment in India.

Recently, South Korean auto major Hyundai has introduced its fully electric SUV Kona, while MG Motors is also lining up five-seater pure electric SUV EZS to launch later this year.

German luxury car maker Audi had unveiled its e-tron EV SUV in India with plans to launch by the last quarter of 2019, while BMW is also studying the feasibility of launching its i3 electric car in Indi

Switching to batteries won't reduce an iota of pollution, says TVS MD

India’s big three two-wheeler makers on Monday hit out at NITI Aayog’s plan to push for 100 per cent electric vehicle, saying such a transition is completely uncalled for and could jeopardise the industry.

Arguing that changing from conventional two-wheelers to 100 per cent electric is “not like Aadhaar, not a software and print cards”, the companies said concerns of all stakeholders must be taken into consideration instead of imposing adoption of EVs. “This is not like Aadhaar, not a software and print cards. You have to set up a whole supply chain, and migrate from the current supply chain,” TVS Motor Chairman and Managing Director Venu Srinivasan said. He said targeting “two- and three-wheelers but not cars makes it an incomplete initiative”. Srinivasan asserted that “changing to batteries running on thermal power will not reduce one iota of pollution”. Right now, he said,”the two-wheeler contribute to 20 per cent of automotive pollution”. Hero MotoCorp said it was “deeply concerned by the potential repercussions of NITI Aayog’s approach of completely banning two-wheelers up to 150cc that are powered by Internal Combustion Engines”.

Last week, NITI Aayog had asked auto industry body Society of Indian Automobile Manufacturers (Siam) along with conventional two-and three-wheeler makers to suggest within two weeks, concrete steps towards transition to electric mobility keeping in mind the 2025 deadline.

Hero MotoCorp said the move by NITI Aayog is being at a time “when two-wheelers manufactured in India will have the world’s cleanest emissions, along with the world’s highest fuel-efficiencies, effective April 1, 2020”.

“Instead of imposing the adoption of EVs (electric vehicles), it would be ideal to have a healthy mix of policy, market dynamics, and customer acceptability,” the country’s largest two-wheeler maker said. Bajaj Auto Managing Director Rajiv Bajaj also said: “We believe 100 per cent transition is completely uncalled for”.

Earlier, he had said the move was impractical and ill-timed, considering the scale involved when stakeholders do not have “any meaningful experience with any of the pieces of the EV puzzle” and that too a date so close to BSVI implementation.

Telangana pitches for Giga-scale battery plant, is ready with 200-acre land

Telangana government has reiterated its readiness to facilitate the establishment of Giga-scale lithium (Li) ion battery manufacturing plant in the state. This what government chief secretary S K Joshi informed the central government agency Niti Aayog, which is spearheading the idea in the light of Government of India's ambitious electric vehicle (EV) push in the country.

Battery manufacturing was considered as one of the important pre-conditions to develop the ecosystem around the EVs as the battery accounts for almost half of the EV cost that can be brought down if the batteries are produced locally. All the major EV manufacturers, including Tesla, has been using Li-ion batteries to power their vehicles.

In a recent video conference with Niti Aayog officials, chief secretary Joshi told that Telangana was ideally suited for hosting 5 Gw capacity battering plant as envisioned by the Centre. He explained that Telangana government can give a readily available piece of 200 acres of land close to the airport and the outer ring road in Hyderabad. The government will also make available the required power and water to the plant at a concessional rate, according to him.

According to Niti Aayog officials, around five states would be chosen for this initiative. Niti Ayog is asking the states to create demand as per the Centre's mandate of converting all three-wheelers in India to electric by 2023 and converting all two-wheelers by 2025.