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    Automakers test the EV market

    Synopsis

    Many firms bought into the hype created by govt’s push and media coverage but are keeping investments low.

    Along with EV makers, component makers of batteries and charging stations have also increased.
    MUMBAI: Contrary to the Indian government’s electrifying dreams for the sector, electric vehicles (EV) have not been the magnet for auto enthusiasts as expected primarily because there are few with performance comparable to conventional vehicles, though EV makers have mushroomed since the policy to boost EV adoption was announced.

    There are at least 50 companies, largely two-wheeler makers that have either established or are in the process of setting up manufacturing or assembling operations for EVs in the country. This is a jump from 12 in 2015, when the government announced the FAME-India (Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India) scheme.

    However, only about half of these companies are selling their EVs commercially, like Ather Energy, Hero Electric, and Ampere to name a few. Many have simply showcased prototypes with no clear visibility on marketing their products. Case in point, 22 Motors, which showcased its production-ready electric scooters at the 2018 Auto Expo, is yet to launch its products in the market. The company has now tied-up with Kymco, a Taiwanese two-wheeler maker, and is gunning for a commercial launch by April 2020.

    Experts say that EVs are a new business opportunity that companies do not want to miss out on. Many new entrants bought into the hype around EVs created by the government’s push and media reports.

    So, companies often ready a technology demonstrator to get their foot in the door and gauge customer reaction. To keep investments low, many even come up with products developed in collaboration with Chinese companies.

    “Even if they are not meeting the government norms to receive subsidies, they are not bothered because they are not here right now for making big business. They just want to test the market,” said Sohinder Gill, director general of Society of Manufacturers of Electric Vehicles (SMEV), an industry body. What also works for EV companies is that these vehicles are not as complex as the vehicles with combustion engines. They have fewer parts and require a less elaborate manufacturing setup.

    “A lot of these people have ventured into this space because it has more to do with technology and less to do with manufacturing because there are fewer parts. A lot of the engineering input would have come from Chinese companies,” said Avik Chattopadhyay, co-founder of brand strategy firm Expereal. The trend is clearly observable in electric scooters and three-wheelers, he said.

    Not just new players, traditional combustion-engine vehicle makers too have speeded up their EV programs though only some, like Tata Motors and Mahindra and Mahindra, are selling these products in the market and that too only to fleet segments. “The government had at one point of time almost threatened that everything will become electric in twowheelers by 2025. If the government keeps giving these jitters, any big player would not like to be caught on the wrong foot,” said Gill, who is also the chief executive of Hero Electric.

    EV makers in the country could be divided into three categories – startups that developed their vehicles in-house, companies that borrowed technology from overseas EV makers, and manufacturers of conventional vehicles who are readying EV technology. Chattopadhyay tags them as ‘Disruptors’, ‘Piggybackers’ and ‘Traditionals’, respectively.

    Along with EV makers, component makers of batteries and charging stations have also increased. As per data from SMEV, the number of member companies with the organisation has gone up from seven to 96 since the announcement of FAME-India scheme in April 2015.

    On the demand side, the market for personal electric vehicles in India is still nascent. In FY19, about 126,000 electric two-wheelers and 500,000 electric three-wheelers were sold in the country, data from SMEV and other industry sources showed. Sale of electric cars was negligible. In fact, the only segment where EV adoption is taking off is in threewheelers as these become a popular last-mile connectivity option in the NCR region.
    (Catch all the Business News, Breaking News Events and Latest News Updates on The Economic Times.)

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    10 Comments on this Story

    St Mumbai322 days ago
    Bharat Stage VI emissions norms will: ⬥︎ bring down NOx emission — by approximately 25% for the petrol engine and 68% for the diesel engines; ⬥︎ bring down sulphur in fuel from 50 parts per million (ppm) to 10 ppm, which would bring down PM emission by approximately 80% in diesel engines; ⬥︎ Bharat Stage VI norms will also change the way particulate matter is measured. It will now be measured by number standard instead of mass standard thereby, regulating the fine particulate matter as well.
    OBD (On-board diagnostics) will become mandatory for every vehicle and it will help monitor the pollution caused by the vehicle in real time.
    RDE (Real Driving Emission) will be introduced for the first time that will measure the emission in real-world conditions and not just under test conditions.
    With this emission norms coming into effect, India will come at par with the US, European countries and other advanced automotive markets across the globe.
    St Mumbai322 days ago
    Being a signatory to the December 2015 Paris Climate Agreement, India is obligated to bring down the carbon footprint by 33-55% from the levels recorded in 2005.
    From the prevalent BS-IV emission standards, India decided to "leap-frog to BS-VI" from 01/04/2020. The shift of from BS-IV to BS-VI is likely to cost petroleum companies anything between ₹50,000 crore to ₹80,000 crore. Besides the national capital region, companies are working on making available BS-VI fuel to 13 metro cities by April 2020.
    BS-IV fuels contain 50 parts per million (ppm) sulphur, the BS-VI grade fuel only has 10 ppm sulphur. The new norms will bring down nitrogen oxides from diesel cars by 70% and in petrol cars by 25%. BS VI will bring PM in diesel cars down by 80%.
    This is a part of the goal to achieve an emissions intensity reduction of around 41.5% below 2005 levels by 2030.
    St Mumbai323 days ago
    Many states only have intermittent power supply. Not the ideal environment for an EV
    The Economic Times