BEV in India: The Decisive Moment

“The inflection point of EV is now here!Venkat Rajaraman, CEO of Cygni Energy, said in a presentation at the 2nd Annual E-Mobility India Forum at Messe Frankfurt late last month.

The Indian battery electric vehicle (BEV) market is clearly developing from the bottom up, with rapid adoption by two-wheeler buyers (despite various fire incidents linked to electric two-wheelers). Changes in consumer attitudes towards electric two-wheelers are greatly influenced by the incentives offered under the FAME II scheme.

However, the FAME II scheme is scheduled to expire on 31 March 2024. Also, the government is unlikely to extend this scheme twice his. It has been extended for two years in June 2021. Therefore, without incentives for buyers, electric two-wheeler sales are expected to slow somewhat.

Still, the electric two-wheeler market serves as a starting point for the electrified passenger vehicle (PV) segment. The rationale is that as an electric two-wheeler buyer moves up the economic ladder, he is drawn to his PV in the A and B segments and becomes more open to buying a BEV.

Not only that, but the electrified PV market could boom from the recently launched Tata Tiago BEV. His third BEV from Tata is by far the most affordable, with an introductory price of just over US$10,000 for him. More importantly, the entry-level His Tiago BEV is only $800 more than the most expensive conventional His Tiago variant. Moreover, it is priced within the range of many ICE equivalents on the market.

Considering various plans for India’s BEV space by OEMs such as Tata Motors, Mahindra & Mahindra and Hyundai, the Indian BEV PV market is expected to experience significant growth by the middle of the decade. From just 4,600 units sold in 2020, he expects the number of BEV PV units to grow to about 207,000 units by 2025. Furthermore, it forecasts further growth after that, with sales of about 590,000 of his BEV PV by 2030.

In terms of percentage, BEV PV sales are projected to grow from 5.5% of total PV in 2025 to 13.5% in 2030.