Driven by India's emission norms, high cost of compliance, and lucrative incentive policies, the buoyant electric vehicle (EV) industry is likely to witness more than eight-and-a-half-fold growth, reaching 4,844,500 million units sales by 2025 from 556,036 units in 2019, finds Frost & Sullivan.
The recent analysis - 'Indian Electric Vehicle Growth Opportunities' by the research agency states that of the total estimated EV sales, electric two-wheelers (e2Ws), eRickshaws, and electric auto-rickshaws (eAuto) will occupy a large chunk of the market, followed by electric four-wheelers and electric buses. Domestic original equipment manufacturers (OEMs) such as Tata Motors and Mahindra & Mahindra and foreign OEMs such as Hyundai and MG have entered the sector with their flagship EVs. They are expected to launch various new EV models in India.
Megatrends such as rapid urbanisation, rising fuel costs, traffic congestion, pollution, emerging economic growth, and energy security will drive electric vehicle (EV) adoption in India in the next few years.
The nascent EV market is fast emerging as a sunrise sector, and the country is expected to push toward electrification aggressively, Frost & Sullivan said.
Prajyot Sathe,Research Manager, Mobility Practice at Frost & Sullivan, said, 'OEMs need to leverage the emerging battery industry to make EVs affordable. The developments in the lithium-ion battery field have created new chemistries/production technologies that reduce the cost of the battery significantly and increase its capacity. This allows OEMs to produce long-range EVs at affordable prices, increasing the sales volume of EVs. Additionally, the massive success of battery swapping, especially in e2Ws and eAuto segments, and increasing charging infrastructures are prominent factors driving EV adoption in the country.'
To tap into the growth prospects brought about by the EV and its component industry, the report suggests the market participants focus on new product launches. OEMs should introduce a comprehensive product line to offer attractive options that suit consumer use cases.
It is necessary to emphasise on customers and branding; OEMs should organise awareness campaigns about the technology and offer attractive options for EV purchases.
Strategic partnerships for technological advancements are critical, the report said. For example, partnerships between charging infrastructure operators, aggregators, manufacturers, and OEMs should be initiated to set up networks of normal and fast chargers across the country.
With the EV sales still revolving around incentives/subsidies, companies should align business strategies with government initiatives. These strategies should be flexible to help companies shift gears when needed without a lot of effort. Further, the government is also looking to localise battery production that will bring the vehicle costs down. 'OEMs need to secure sufficient battery supply to avoid any production halts or bottlenecks,' Sathe added.
Courtesy: Frost & Sullivan. NB: Photo is representational.