ADVERTISEMENTs
.png)
India poised to hit tipping point for EV mass adoption
Reduced import duties may see US EV leader Tesla finally entering Indian market
One of the more affordable EVs in the Tata passenger vehicle catalogue, the Punch / Tata Motors
According to a Bloomberg survey released last week, among 31 countries that have crossed the tipping point for mass adoption of electric vehicles (EVs), high-tech countries such as the United States, Japan, and Korea, which have what it takes to be front-runners, are actually laggards.
On the other hand, a country like India, which faces challenges to large-scale shift to EVs, is nevertheless poised to cross the tipping point as EVs reach price parity with petrol and diesel vehicles.
Also last week, a separate survey by Counterpoint Research found that EV sales in India nearly doubled in 2023 and are poised to rise by 66 percent this year, making up for four percent of all passenger vehicle sales.
The accepted tipping point, according to industry experts, is five percent of new cars going electric. And India may hit this number soon, driven by continuing government subsidies and a choice of new makes available: no small achievement considering the obstacles –low per capita income and a disproportionately large rural hinterland.
Tata dominates in India
The April 5 announcement from Counterpoint Research, based on its study of India’s EV market, rates Tata Motors as the dominant player with 70 percent of the market share. It offers multiple models -Nexon, Tiago, Tigor, and Punch. With just one model, the XUV400 SUV, Mahindra & Mahindra was the fastest growing brand in 2023, recording a 2476 percent increase in just one year, followed by Chinese brands BYD and MG Motors.
Maruti Suzuki’s entry into the EV market is expected to challenge Tata’s dominance. Moreover, VinFast, the Vietnamese brand’s move to build a factory in India’s Tamil Nadu state, points to the growing interest and investment in EV manufacturing in the country.
Long waiting in the wings and now poised to enter the Indian market after some recently announced cuts in import duties for up to 8000 cars in one year is the American EV leader, Tesla.
The German plant of Tesla was noticed to be making right-hand drive cars, which led Reuters to suggest this could potentially be for the Indian market. However, lower duties require the importer to invest around US$ 2 billion in India which would indicate some indigenous manufacturing.
Counterpoint Research's Associate Director Liz Lee, said, “India’s EV landscape is on the cusp of significant growth. The rise in EV battery manufacturing, supported by key players like Ola, Reliance New Energy and ACC Energy Storage, alongside the Make in India initiative, will lower manufacturing costs and boost EV sales. Government initiatives such as the PLI scheme for Advanced Chemistry Cells (ACC) and the recent reduction in import duties on EVs under $35,000 to 15 percent are game changers.”
Why are the EV leaders lagging?
A follow-up feature from Bloomberg tries to understand why the US and a few others, who are well positioned, are still EV letdowns.
Japan has a vested interest in going slow with EVs; its priority is hydrogen-cell-based vehicles. “Japan’s slow adoption of EVs traces back to a bet made a decade ago by Tokyo technocrats and Japanese automakers to invest heavily in hydrogen fuel-cell technology. Toyota Motor Corp., the world’s largest carmaker, has since been a frequent EV sceptic.. lobbying against government policies that promote them around the world.”
South Korea has practical hurdles: “Many Koreans live in high-rise residential apartment complexes, and don’t have reliable access to at-home chargers.” This is in spite of Korea being the home of leading EVs worldwide. Hyundai Motor Group and Kia Corp.
In the case of the US: “Even though sales of fully electric vehicles made up more than eight percent of new car sales in the fourth quarter, the trend has been slower than in the 20 countries that came before the US.” Other reasons: high prices, a lack of EV variety, and anxiety about the availability of public chargers. And one overriding brake on EVs: “America’s biggest holdup has been its obsession with battery range. US drivers demand more range than drivers from any other country.”
ADVERTISEMENT
ADVERTISEMENT
E Paper
Video
.jpg)
.jpg)
.jpg)
.jpg)
.png)
.png)
.png)
.jpeg)
Comments
Start the conversation
Become a member of New India Abroad to start commenting.
Sign Up Now
Already have an account? Login