FAME estimates electric two-wheelers to touch the magical 25 million mark by 2019-20 while SMEV pegs them at 250,000 units growing at a CAGR of about 8 percent till FY20.
17 Nov 2016 | 11624 Views | By Shobha Mathur
About 1 million high-performance electric two-wheelers are required to rev up the Indian roads in the year 2017 to get back on track to achieving the targets listed in the National Electric Mobility Mission Plan (NEMMP) 2020.
“At the present rate of growth we are heading for a 90 ...
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About 1 million high-performance electric two-wheelers are required to rev up the Indian roads in the year 2017 to get back on track to achieving the targets listed in the National Electric Mobility Mission Plan (NEMMP) 2020.
“At the present rate of growth we are heading for a 90 percent shortfall in NEMMP targets,” revealed Sohinder Gill CEO- Hero Electric and director - Corporate Affairs of the Society of Electric Vehicle Manufacturers (SMEV) at Autocar Professional’s first Two-wheeler industry Conclave in Delhi held on November 16. He was speaking on the session on a New Era of Mobility -- Building the Electric Vehicle Industry in India.
While the Faster Adoption and Manufacturing of hybrid and electric vehicles (FAME) scheme rolled out by the Central government last April claims that 163,921 electric two-wheelers were sold in the country in 2015-16 with 317,437 units to be sold in 2016-17, SMEV maintains that electric two-wheeler sales stood at 20,000 units in FY’16 and is pegged at 25,000 units in FY’17. FAME estimates these vehicles to touch the magical 25 million mark by 2019-20 while SMEV pegs them at 250,000 units growing at a CAGR of about 8 percent till FY’20.
Hence, there is an urgent need to step up the production and sale of electric two-wheelers. The NEMMP in turn that was launched in 2013 targets 6-7 million electric and hybrid vehicles by 2020 with some level of indigenisation. SMEV is forecasting a shortfall by the completion of the plan period. This despite electric two-wheelers being non-polluting and accruing in a saving of 70 paise per km compared to petrol two-wheelers that cost roughly Re1.20 per km in terms of fuel consumption. A major constraint though in using electrics is their high-cost lithium ion batteries that step up the cost of the EV.
“We need to incentivise the use of lithium-ion batteries,” says Gill. The FAME scheme offers incentives to consumers for the purchase of electric and hybrid vehicles.
But the lithium ion battery along with critical components like the e-motor, the controller continues to be imported from countries like China, Korea and Taiwan and even the US that raises the price of the xEVs. Hence, local production of lithium ion batteries is imperative to tap economies of scale.
In addition, Gill suggested that two-wheeler fleets used in the delivery chain should be fully converted to electrics over the next two years as they are currently running on BS-II emission norms and are very polluting being gasoline driven.
At the current rate of growth catching up with the China growth story was out of reach. Interestingly 50 percent of the electric cars in China are given discounts that boost their growth with a huge volume running on lead acid batteries. That makes these vehicles more affordable tapping economies of scale.
Two start-ups participating at the event were Ather Energy of Bangalore and Tork Motorcycles. While agreeing that charging infrastructure was inadequate for electric vehicles currently, Tarun Mehta, co-founder and CEO, Ather Energy confirmed that the start-up that has developed its first smart electric scooter Ather S340 plans to provide charging infrastructure in Pune, Bangalore and Chennai leveraging its vendor ecosystem to boost EV sales.
“The way forward is electric and connected for which there is no better time than now to start work. Initiatives like make in India, smart cities, EV subsidies and clean environment will drive this growth forward,” Mehta added.
For this long-term investments would be necessitated to be made on developing new platforms and new vendors, setting up of distribution and servicing centres, energy infrastructure and facilitating vertical integration to make the EV cost effective. On the other hand Kapil Shelke, Director, Tork Motorcycles the company that has just launched its first fastest electric motorcycle with a 100 km plus range maintains that everything revolves around owning a brand. Pre- sales and post sales are always the customer pain points, according to him.
India saw a 37.5 percent rise in EV sales last year with 22,000 units sold in 2015-2016 of which 20,000 units sold were two-wheelers. An increased awareness about EV’s and lithium ion batteries is required to promote their growth. Under the FAME scheme, an electric motorcycle will be subsidised upto Rs 29,000.
SMEV statistics reveal that 16 crore petrol two-wheelers ply on the roads with 2 crore added yearly. While the fuel cost till now is pegged at Rs 210,000 crore, Rs 2,100 crore is estimated to be added annually. Petrol two-wheelers have emitted 111 million tonnes of CO2 till date with 13 million tonnes adding to the environmental pollution each year. Further, a 3 percent increase in CO2 levels is expected in the short to mid-term before the transition to EVs gathers momentum.
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