The Boston Consulting Group (BCG) has released a comprehensive report entitled “Surging Ahead: How electric two-wheelers are rapidly gaining popularity with the diverse Indian consumer”, offering deep insights into the dynamics of the electric two-wheeler (E2W) market in India. The study sheds light on the adoption trends and identifies crucial factors driving the increasing acceptance of E2Ws among Indian consumers.
According to data from the Ministry of Road Transport and Highways (MoRTH), the E2W market in India has seen remarkable growth, expanding from a mere 0.3% of all two-wheeler sales in FY21 to 5.4% in FY24. The report highlights a significant increase in consumer interest, with approximately 80,000 new consumers embracing electric two-wheelers every month of this year.
Diverse Consumer Demand
BCG’s research identifies ten unique 'demand spaces' that categorise consumers based on their specific needs and usage patterns rather than demographics. These categories range from those requiring basic transportation to those seeking high-performance and aesthetically pleasing models for livelihood or status projection. This segmentation helps underline the diverse functional and emotive needs that drive consumer choices in the E2W segment.
Strategic Imperatives For OEMs
The report outlines several strategic imperatives for original equipment manufacturers (OEMs) aiming to capitalise on this burgeoning market:
Prioritize Target Value Pools: OEMs must tailor their products and marketing strategies to the specific demand spaces identified.
Innovate Go-to-Market (GTM) Strategies: Manufacturers are advised to streamline the customer journey, revise pricing models, develop alternative ownership schemes, and enhance charging and service networks.
Orchestrate Partnership Ecosystems: Collaborative efforts across vehicle lifecycle services and mobility solutions are deemed essential for market success.
Build Organizational Capabilities: Companies need to adapt their organisational structures thoughtfully, choosing between in-house development and external partnerships to build sustainable competitive advantages.
Shift In Consumer Perception
The report highlights a shift in consumer perception towards E2Ws, driven by improvements in affordability, ride smoothness, safety, and storage solutions. It notes that one in three potential two-wheeler buyers is now considering an electric option, a significant increase from earlier figures.
“Success in the E2W market requires a clear understanding of consumer needs and a well-defined market approach,” explains Natarajan Sankar, Managing Director and Partner at BCG. The report, based on a survey of nearly 2,750 respondents, provides OEMs and other stakeholders with the data needed to enhance their market positions and foster the broader adoption of sustainable transportation solutions in India.
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