Important Developments From The World Of Electric Vehicles [16-22 November]
Over the last one month, Delhi has been sinking deeper into the clutches of a noxious smog that is slowly taking away our most basic right: clean air. Millions of people, including kids and elders, are struggling daily to breathe and even see properly, which begs the question, are we doing all that we can to prevent the country’s capital city from turning into a ghost town like Pripyat in Ukraine? As India hurtles towards an apocalyptic future, is there nothing that we can do to stop it? As it turns out, a major contributor of Delhi’s smog is automobile exhaust. With more than 10 Mn cars in Delhi alone, the need of the hour is to adopt cleaner and greener alternatives to environmentally-damaging fossil fuels. Electric vehicles (EVs), while not entirely pollution free, can help a lot in curbing emissions and making India liveable again.
Thankfully, the government has been doubling down on its efforts to switch to 100% electric vehicles by 2030. As a result of the government’s sustained push, the EV sector has been abuzz with activities, developments and reforms. While Suzuki and Toyota have teamed up to bring electric vehicles to India by 2020, Ola and Indian Oil have launched the country’s first charging station in Nagpur.
Given that so much is happening in the country, for our part, we decided to curate and bring weekly roundups of important developments from the electric vehicles industry.
Let’s take a look at the recent happenings from the world of electric vehicles:
Honda Eyes Entry Into Indian EV Market With The Launch Of Hybrid Solutions
After Suzuki and Tata Motors, Honda Cars India Limited (HCIL) has jumped on the electric vehicles (EV) bandwagon. The Indian subsidiary of Honda Japan is said to be in the process of adopting an EV strategy and is currently evaluating the feasibility of manufacturing country-focussed battery-powered electric vehicles that are both affordable and suitable for Indian roads.
The move is part of the company’s long-term goal to bolster the sales of its electric vehicles worldwide. By 2030, Honda expects more than 65% of its global sales to come from electrically-powered vehicles. To that end, it has already established an Electric Vehicle Development Division inside the Honda R&D facility in Japan, where a dedicated team is working on expediting the manufacturing process of electric vehicles.
As stated by Honda Motor CEO Takahiro Hachigo, given that the market for all-electric vehicles is still nascent in India, hybrid technologies stand a greater chance of gaining traction at the moment. Keeping that in mind, the company is preparing to bring its powertrain solution Honda Jazz Hybrid as well as its mid-sized sedan Honda Grace to India soon.
FICCI And Rocky Mountain Institute Release A Report About The Impact Of EVs In India
Titled ‘Enabling India’s Transition to Electric Mobility’, the report by FICCI and Rocky Mountain Institute states that, in the passenger vehicle sector, the country’s shift to shared, electric and connected mobility could help save up to $300 Bn (INR 20 Lakh Cr) in oil imports and nearly 1 gigatonne of carbon dioxide emissions by 2030.
According to the report, within the shared mobility segment alone, more than 46 Mn electric vehicles, including – two-, three- and four-wheelers, could be sold by 2030. Furthermore, sales of four-wheel EVs is expected to exceed that of internal combustion engines (ICEs) by 2027. In the three years after that, electric car and other four-wheelers will touch the 16 Mn mark in sales.
In the report, FICCI and Rocky Mountain Institute have identified some of the major barriers in EV adoption: price, selection, range, charging and consumer adoption. Addressing these challenges, the report has also provided a comprehensive roadmap focussed on six key areas of the passenger mobility sector.
Ola And Indian Oil Launch India’s First Charging Station In Nagpur
Earlier this week, Nagpur became the first Indian city to get an electric vehicle charging station. The charging station has been launched at one of Indian Oil’s petrol/diesel stations in Nagpur, in collaboration with homegrown cab aggregator Ola.
Speaking at the launch, Murali Srinivasan, Executive Director of Indian Oil, stated, “As India’s leading oil refiner and marketer, IndianOil considers promoting ecological sustainability as part of its core business. Thus, this partnership with Ola is the right step forward as we re-imagine how India will commute in the coming years. We applaud Ola for building the Electric Vehicle eco-system from a nascent stage in Nagpur and are happy to partner with them in their efforts.”
The development has come six months after the orange city became the first in India to introduce a fleet of 200 electric vehicles, including taxis, buses, e-rickshaw and autos, for public transport. While Mahindra Motors announced that it would be supplying 100 e2O Plus electric vehicles, Nagpur authorities procured the remaining 100 vehicles from Tata Motors, Kinetic, US electric vehicle maker Build Your Dreams (BYD), and TVS, among others.
NITI Aayog Can’t Be The Implementing Agency For India’s EV Mission 2030: Nitin Gadkari
The Union Minister for Road Transport and Highways has voiced his objection to NITI Aayog’s decision to nominate itself as the implementing agency for the government’s 100% electric vehicle mobility mission. During a recent media interaction, Nitin Gadkari, said, “NITI Aayog’s role is to develop good policies and they should do that. They should not become an implementing agency. Implementation should be given to anybody deemed to be fit by the Cabinet.”
According to Gadkari, while the effort to bring all electric vehicle-related issues under the same roof is a welcome move, the think tank does not have the power to make the final decision as to who should be implementing the government’s electric vehicle policies. It can, however, suggest names as part of its policy recommendations. The final call lies with the Cabinet, the minister added.
In a related development, the minister has called the government-appointed think tank’s battery swapping policy for accelerated adoption of electric vehicles “not viable”. During the Smart Mobility Conference on Monday, he stated, “The battery swapping policy I feel is not appropriate for the country because it is a very difficult thing. We are working on a charging system that can reduce the charge time to 15-20 minutes.”
TVS Group To Supply Electric Car Components To Tesla
The Madurai-headquartered diversified industrial conglomerate has accepted an order from global EV manufacturer Tesla to supply vital car parts. As part of the deal, TVS Group-owned auto component maker, Sundram Fasteners, will be providing Tesla with radiator caps as well as key parts in gear transmission. The development marks the company’s first steps into the booming electric vehicles market.
Commenting on the development, Suresh Krishna, Chairman and Managing Director of Sundram Fasteners, said, “We knew this was coming. Even in 2030, the prognosis is that only 8% of the vehicles in the world will be electric, but that will be the inflection point. Around 2040, that ratio will jump to 30-40% and anybody in the auto-component industry has to take that into account.”
In addition to radiator caps, TVS Group-operated company has been supplying surge tank caps that help protect the coolant and bevel gears, special tooth-edged components that are mounted on the shafts in the car’s gear system.
Mahindra Partners With Zoomcar To Accelerate EV Adoption In Mysuru
Currently the country’s sole electric vehicles manufacturer, Mahindra and Mahindra has forged a partnership with self-drive car rental platform, Zoomcar. As part of the newly-announced alliance, the Bengaluru-based startup will be deploying 20 units of Mahindra’s all-electric smart car, e2oPlus as well as two charging units in Mysuru.
Aimed at promoting sustainable and eco-friendly modes of transport in the city, the initiative will make these electric vehicles available to residents and visitors looking to rent a car. The duo also intends to eventually extend the initiative to other cities in the country, including Hyderabad, Delhi and Chandigarh.
As per the terms of the deal, Mahindra Electric will also be providing fast-charging services to Zoomcar to ensure seamless customer experience. The two charging units procured by the self-drive car company are currently located at Country Inn and Garuda Mall in Mysuru.
Suzuki And Toyota Joins Hands To Launch Electric Vehicles In India By 2020
In addition to Honda, two other Japanese automakers, Suzuki and Toyota, have set their eyes on the Indian EV market. The two automotive giants, Toyota and Suzuki, have recently partnered up to launch EVs suitable for Indian traffic and road conditions by 2020. As per the memorandum of understanding (MoU) signed last Friday, Toyota will provide technical support for the project, while Suzuki will handle the manufacturing part of it.
According to the terms of the deal, Suzuki will also be supplying some of the EVs to Toyota for deployment across the country. Commenting on the development, Maruti Suzuki Chairman RC Bhargava said, “The MoU concluded is part of the overall agreement being firmed up between Suzuki and Toyota. Since this (India’s EV push with a 2030 deadline) was a more urgent issue, it has been addressed first. It will surely prove beneficial for all involved. We have to make sure that not only the cost, ut the performance of the vehicle is such that it meets customer expectations.”
Prior to this, Suzuki announced plans to start manufacturing electric vehicles in India, as part of a move geared towards boosting revenues as the company’s net profit dwindles in H2 2017. Earlier, in the second week of September, the Japanese parent of Maruti Suzuki India revealed plans to manufacture EVs at a factory in Gujarat. As part of the initiative, Suzuki committed $600 Mn (INR 3,900 Cr) for the construction of a new plant at Hansalpur.
Next Tender For 10,000 EVs To Go Live By April 2018: EESL MD
As a major step towards procuring 1 Mn electric three-wheelers and 10,000 electrically-powered city buses by mid-2019, government-run EESL, a joint venture of NTPC Limited, Power Finance Corporation, Rural Electrification Corporation, and POWERGRID, has announced plans to float another tender for 10,000 electric vehicles in March or April of next year.
In line with the government’s electric mobility mission, the move will allow the Delhi government to procure electrically-powered city buses, with the aim of lower pollution levels in the national capital region. During a recent media interaction, EESL MD Saurabh Kumar said, “There will be another tender for 10,000 electric cars in March or April next year.”
In the second week of September, EESL floated the first tender for 10,000 EVs and 4,000 charging stations in Delhi/NCR. At the time, it was reported that the government was also gearing up to invite bids for up to 50,000 electric three-wheelers by December 2017. The first tender, which was finalised last month, was awarded to Tata Motors the tender, while Mahindra said it would match Tata Motors’ lowest bid of $15,534 (INR 10.16 Lakh) per vehicle. Other companies that participated in the bidding include Toyota, Maruti Suzuki and Hyundai, among others.
Tesla Unveils Electric Big-Rig Truck Tesla Semi, Roadster
Image Credit: HGM Sites
In the international circuit, EV manufacturing giant Tesla has unveiled an electrically-powered big-rig truck called Tesla Semi. As part of the launch, Tesla CEO Elon Musk drove the truck right into an airport hangar near Los Angeles. Talk about a fancy entry! From the truck’s trailer then came out a sleek electric car known as Roadster.
Touted as an updated version of Tesla’s first production vehicle, the four-seat electric car has a range of 1,000 km on full charge. As stated by Musk, Roadster can go from zero to 100 kmph in less than 1.9 seconds. On the other hand, Tesla Semi can go from 0 to 100 kmph in under five seconds without cargo and in around 20 seconds when carrying a maximum load of 36,300 kg. At maximum weight, the truck can cover a distance of 800 km on full charge.
According to Elon, Tesla Semi represents the company’s sustained efforts to facilitate the transition from fossil fuels to eco-friendly EVs and renewable energy through solar roofs and power storage. Currently in the prototype stage, Tesla will start producing the truck by 2019. To that end, it is planning to invest in a separate, state-of-the-art factory.
Electric Vehicles Could Create $300 Bn Domestic Battery Market: NITI Aayog
NITI Aayog, the government-appointed think tank that is currently developing a roadmap of India’s Electric Vehicle Mission 2030, has put forward a plan for domestic battery manufacturers to produce batteries for EVs under the “Make in India” scheme. It recently stated that the transition to all-electric cars could create a $300 Bn market for EV batteries in the country by the end of next decade.
Speaking about the massive opportunity that exists for battery manufacturers in India, NITI Aayog CEO Amitabh Kant said, “India’s mobility transformation presents an enormous economic opportunity. Innovative business models and supportive policy frameworks can help make India a global hub for manufacturing electric vehicles and their components, accelerating this transition which creating jobs, strengthening Indian industry and cleaning the air.”
To support mass production of electric vehicles and batteries, the government should implement a feebate policy, Kant added. According to him, the aim should be to offer rebate and incentives on efficient vehicles, while also instituting surcharge on inefficient, environmentally-damaging vehicles.
Govt’s Push For EVs Could Be Damaging To Other Businesses, Fears Auto-Component Makers
While the government is doubling down on its efforts to attain 100% electric vehicles by 2030, several auto component manufacturers have expressed concerns about how the adoption of EVs will alter their businesses drastically. To cut losses and prepare for a dwindling market in the coming years, many companies in this sector have already decided against investing any more money into their businesses.
As per reports, the Auto Component Manufacturers Association of India (ACMA), the representative body of auto part makers in the country, is currently evaluating the impact that EVs could have on the car component industry. Based on the findings of the study, the association is expected to submit a report to the government in a month.
The main concern has stemmed from that fact that while internal combustion engines consist of 2,000 moving parts, the engine of an electric vehicle has around 20, meaning fewer breakdowns and repairs. As stated by ACMA Director General Vinnie Mehta, ICEs currently account for nearly $22.5 Bn of the sector’s annual revenue. Voicing his concerns, Mehta said, “The government and the industry should work together for a technology agnostic road map for electric mobility with a definite timeline so that the industry is not caught unawares.”
Toyota Kirloskar Motor’s Shekar Viswanathan Calls For Equal Tax On Hybrid And Electric Cars
With the implementation of GST in July, tax levied on hybrid cars jumped dramatically to 43%, while that on electric vehicles dropped to 12%. According to Toyota Kirloskar Motor Vice Chairman and Director Shekar Viswanathan, the need of the hour is for the government to be “technology-agnostic”. Given that the EV sector in India is still nascent, the country’s government should promote other kinds of eco-friendly vehicles as well.
Increased taxation has understandably caused the sales of hybrid vehicles to plunge in India. For instance, the joint venture between Japan’s Toyota Motor and India’s Kirloskar Group ceased production of the Camry sedan hybrid temporarily on October 24. Additionally, between July and September, the sales of Toyota Motor’s Camry dropped by 73% to a mere 87 units, while prices soared from $6,175.4-$69,473.7 (INR 4 Lakh-INR 45 Lakh). Similarly, Maruti Suzuki India reported a dip in sales of its two hybrid models: the premium sedan Ciaz and the multi-utility vehicle Ertiga in recent months.
Calling the current tax structure “unreasonable”, Toyota Kirloskar Motor’s Viswanathan stated, “The tax structure needs to encourage hybrids because it is disproportionate to what the actual demand (for hybrids) can be.” By creating a market for hybrid cars, the government would, in turn, pave the way for electric vehicles, Shekar added.
Sona Group Announces Entry Into India’s Electric Vehicles Market
Following in the footsteps of TVS’ Sundram Fasteners, Sona Group has become the second Indian company to provide EV components to foreign companies. The firm has signed a contract with a European electric vehicles manufacturer to supply forged components, including electric axles for three-wheelers.
Sona Group CEO Sunjay Kapur told ET, “Now we are testing e-axles for light commercial vehicles in India to see how we can fit our e-axle in it.” Currently, e-axles are imported from China and then tweaked to be made compatible with local motor and controller models.
To capitalise on this untapped market, the company has recently set up a manufacturing facility at Gurugram for electric axles and differential gears. Through the partnership, Sona Group is also looking to create a presence in the hybrid electric vehicle industry.
Big Automobile Companies Don’t Want India To Become An All-Electric Car Nation: Ashok Jhunjhunwala
Less than a year after being appointed as a key government adviser in the Electric Vehicles Mission 2030, IIT Madras professor Ashok Jhunjhunwala has stepped down from his position, amidst a crossfire of controversies and blame games. Talking about the reason behind his resignation, he has alleged that many domestic and international automotive companies do not want India to transition to 100% electric cars.
Many industry executives have retorted saying that he was tweaking the norms to award contracts to some companies as part of the EV tenders floated by EESL. Addressing the allegations that have been making the rounds, Jhunjhunwala said, “I have done everything transparently. After all, for professors, reputation is everything. I am aware of the allegations against me. A lot of people dislike me and are trying all sorts of tricks and nuisance because they don’t want the electric vehicle mission to happen. If it is all correct, how will I be a part of the government.”
As an adviser to the Ministry of Power, Coal, New and Renewable Energy, Jhunjhunwala was entrusted with the task of creating a roadmap that would allow the government to move to all-electric cars without the need for subsidies. One of the proposals he put forward was to sell electric vehicles without batteries, which could later be hired separately to lower costs. As per reports, he will now serve as the principal adviser in the railway ministry under Piyush Goyal.
With big automotive players like Honda, Suzuki, Toyota and Tata Motors eagerly eyeing a piece of the electric vehicles sector, the market is expected to undergo rapid growth and development in the coming months. While Japanese giants Suzuki and Toyota are gearing up to bring EVs to India by 2020, auto component manufacturers like Sundram Fasteners and Sona Group are working to make the manufacturing of electric vehicles easier, more affordable and efficient. Whether the debate on reducing taxes of hybrid cars reaches a resolution in the near future remains to be seen.
Until then, stay tuned for the next edition of our weekly series of Electric Vehicles Roundup!