Mahindra-Tata EV race
The Indian electric car market is projected to reach US$707.4 million by 2025, predominantly driven by the government schemes, growing environmental concerns, and falling battery prices, said a research report on 27 Feb 2019.
“Several incentives, such as tax rebates, grants, and subsidies, have been launched by the central and state governments in order to increase electric car adoption in the country,” noted ResearchAndMarkets in the report on the electric car market.
Based on the technology, the Indian electric car market has been categorized into battery electric vehicle (BEV), plug-in hybrid electric vehicle (PHEV), and hybrid electric vehicle (HEV).
Of the three, the BEV category dominated the market during the historical years and is expected to continue doing so in the coming years.
Much of this can be attributed to the highest subsidies offered by the Indian government on the purchase of BEVs as compared to PHEVs and HEVs and availability of a number of low-cost BEV models in the market.
On the basis of the product, the Indian electric car market has been classified into hatchback, sedan, sports utility vehicle (SUV), and others.
The others category includes multi-utility vehicles (MUVs), microcars, minivans, luxury cars, and sports cars.
The hatchback category held the largest share in the market in terms of volume as well as value in 2017, contributing over 45% revenue share, noted the report.
This can be owed to the low cost of the hatchback category as compared to sedan and SUV.
During the forecast period 2013-2025, the market for SUV category is forecasted to grow at the fastest rate, owing to the rise in disposable income of the users and increasing recognition for SUVs as status symbol in the Indian society.
The Government schemes and subsidies are playing a major role in the growth of the Indian electric car market, it noted.
The urban population has increased rapidly over the past decade, resulting in rise in pollution levels. To curb this issue, the Indian government is encouraging and supporting the adoption of electric cars through its several financial schemes and incentives.
Several policies related to electric vehicle (EV) have been announced by the public authorities of India over the past few years indicating substantial action and ambition for the adoption of EVs in the country.
For instance, in 2015, the Indian government introduced a scheme under the National Electric Mobility Mission Plan (NEMMP) namely Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) scheme to encourage the adoption of clean fuel technology cars that boosted the growth of the Indian electric car market.
The scheme was launched in the Union Budget for the fiscal year 2015-2016 with a primary expense of US$11.46 million (Rs.75 crores). It was targeted to decrease the upfront purchase value of electric and hybrid vehicles and to stimulate their early adoption.
Maharashtra had the highest electric car sales volume in 2017, accounting for a market share of 28.9% in the Indian electric car market. The state is expected to continue being the leading market in the country for electric cars during the forecast period, owing to the state government’s Electric Vehicle Policy 2018 to help the EV market grow by supporting EV manufacturing, developing charging infrastructure, and offering subsidies to costumers on the purchase of these vehicles.
The state government announced subsidies for electric cars, amounting up to US$1,550 (Rs.100,000) per vehicle.
However, Tamil Nadu electric car market is expected to outperform all other states in terms of growth, witnessing a CAGR of 51.5%.
The Indian electric car market is highly consolidated and is dominated by Mahindra Electric Mobility Ltd. Currently, the company is the only BEV manufacturer in the country.
It had ventured into the electric car industry much earlier than other Indian automotive players through the acquisition of Reva Electric Car Company in 2010.
However, Tata Motors Ltd is expected to gain a significant market share in the Indian electric car industry during the forecast period, as it has announced to launch two electric car models, Tigor Electric and Tiago Electric, by the end of 2019.
Companies profiled are Hyundai Motor Company, Mahindra Electric Mobility Limited, Volvo Car Corporation, Toyota Kirloskar Motor Pvt Ltd, Tata Motors Limited and Honda Motor Co Ltd. fiinews.com
