Electric Mobility: How the Next Sunrise Industry is taking shape in India?

Electric Mobility: How the Next Sunrise Industry is taking shape in India?

 

As we move into this new decade, which many of us believe is going to be the year of electric mobility, let’s have a look as to how the ecosystem is developing around this Sunrise Industry in India. In this blog, we will look at

  1. Size and potential of market (India),
  2. Why is movement towards Electric Vehicles picking up
  3. The way forward

There are predominantly 3 types of Electric vehicles that are based on the type of energy source; Battery Electric Vehicles (BEVs), Plug in Hybrid Electric vehicles (PHEVs) and Hybrid Electric Vehicles (HEVs). In terms of means of transportation, the classification can be E- Commercial Vehicles, E-Cars, E-Bikes, & E-Scooters.

The Market – INDIA

How can you define the Indian market?  It is Young, big, one of the fastest growing, urbanised and of course, most polluted. Here are a few demographical statistics about India that will help us in understanding its market.

Youngest large country in the world

Electric Mobility: Youngest large country in the world

  • 29 years median age
  • 64% of India’s population is below 40years.

India is rapidli urbanising

  • with high level of migrants moving from rural areas to cities.
  • and the boundaries of cities are expanding to accommodate more rural areas into urban framework.

World firsted growing largest Industry

Booming Midle Class

  • Roughly, 40% of the next billion entrants in Middle class in the world will be from India.
  • More dispensable income will lead to higher buying power.

Electric mobility Sunrise industry in India

All the above factors indicate a very high potential for affordable and clean mobility in India – the only solution available is clearly electric mobility

Why is movement towards Electric Mobility picking up?

  1. Major push from the government to generate demand. 

  • FAME 2 was launched last year, which gives up to 20% subsidy on the electric vehicles
    • Major push from the government towards Make In India for the components.
    • The subsidies are also linked to indigenisation of the components used in electric vehicles
  • GST was dropped from 12% to just 5% on electric vehicles
  1. Increasing fuel prices

    • It is a big factor that is forcing the commuters to look at alternative fuel – electricity
  1. Electric Vehicles are more economical

  • Cost per KM is just 5% to 10% in case of electric vehicles as compared to ICE vehicles.
  1. Lower cost of maintenance.

    • As the numbers of moving parts are just 20 in an electric vehicle as against 2000 in ICE vehicles, the wear and tear and corresponding maintenance is much lower.
  1. New age companies

    • We have witnessed a plethora of new age companies riding on electric mobility wave, leading to faster uptake of electric vehicles.
    • New ownership models have evolved, on electric mobility platform as the cost of ownership is much lower than ICE vehicles
    • Ride sharing
    • Ride Hailing
    • Fleets etc.
The way forward

The technology is improving at a very fast pace, leading to better batteries with higher capacities and longer life, Superior drive train for better power and durability, & this is leading to a much better experience in Electric Vehicles

Further, Lithium battery prices are reducing year on year. As we go forward, the contribution of battery price in complete electric vehicle is expected to move from 40% to 20%, in next 5 years. This will bring the cost of electric vehicles considerably in the years to come. The size of the market can is going to be as big as USD 30 billion in next 10 years.

So the Conclusion is that; the market is big, opportunity is ripe, technology is right and improving, Consumer confidence is building, Electric Mobility’s time has come.

 

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