India’s electric journey has a four-wheel-sized problem. While the market seems to have picked up for two-wheelers and three-wheelers and to an extent, for electric buses as well, the electric car segment has been underperforming.
The launch of the government’s new subsidy scheme for electric mobility, the PM-DRIVE scheme has only complicated the situation further — while the earlier schemes FAME 1 and 2 had incentives for electric cars as well, the new scheme, launched officially last weekend, has provisions only for electric two-wheelers and electric three-wheelers.
Take the case of the sale of electric cars last month. Sales are at a nearly-two year low, with less than 6,000 electric passenger vehicles sold all across the country. While this is a new low, conventionally too, electric four-wheelers have performed below par in India, with all the action taking place on the two-wheeler and three-wheeler side. For example, out of the nearly 40 lakh electric vehicles sold in India back in 2022, less than 50,000 were electric cars.
"Electric cars offer tremendous potential for India’s future, but I agree that adoption has been slower than anticipated,” said Sanjay Takale, director, Aerpace Industries, who went on to explain why. “Range anxiety, driven by limited charging infrastructure and higher upfront costs remains a key concern.”
“Additionally, many consumers are still unaware of the long-term financial and environmental benefits,” Takale added.
Pritesh Talwar, president (EV Business) of Lectrix explained this strange phenomenon of the Indian approach to cars vis-a-vis bikes and scooters. “Two-wheelers in India have always been viewed as utility products, rather than aspirational vehicles. For many, owning a two-wheeler represents a significant step in their journey toward success (with) many not yet in a position to purchase a car. The compact size and lower cost of electric two-wheelers make them more accessible to the average Indian consumer.”
While the Indian government has been wooing the likes of Elon Musk’s Tesla by even tweaking manufacturing rules, the fact remains that electric cars are still in the realm of aspiration. This also explains why most of the electric car models in the country, ranging from Hyundai’s Ioniq 5, whose price is around half a crore, tend to be on the premium side. Chinese major BYD also has a couple of models in the market including the e-Max 7 launched on Tuesday, a multi-purpose vehicle that has 6-seater and 7-seater options, costing 27 lakh rupees upwards.
Except for Tata, which has models priced at least around the psychological Rs 10 lakh mark, most companies still bring in pricey electric cars, knowing fully well the market isn’t mature, leading to the proverbial chicken-and-egg situation. Even for BYD, its premium models often find takers amongst fleet operators compared to individual customers, which has been the case with many of Tata’s more affordable models as well.
Another curious case has been the reticence of the Japanese biggies who majority straddle the Indian car market to push for electric. Having missed the electric wave whose pole position seems to have been firmly taken by the Chinese, the Japs have been pushing for hybrids and other ‘clean’ technologies, arguing that as long as emissions are progressively reduced, even fossil fuels will do.
Will the situation change? As the market evolve, customers evolve and environment consciousness get more massy—not to forget the prices heading downwards firmly and charging infra becomes standardised and commonplace—India could just head down the electric path on four wheels.
“To accelerate the shift, we need stronger policy support, an expanded charging network, and more affordable EV options to make electric mobility accessible to all,” suggests Takale.