2W EV Sales To Make Up 78% Of Total Sales By 2030: Redseer

Two-Wheeler EV Sales To Make Up 78% Of Total Sales By 2030: Redseer Report

SUMMARY

With better features, superior economics in terms of running cost and being more eco-friendly, electric two-wheelers are expected to see higher adoption: Redseer

Redseer suggested in its report that the early adopters of electric two-wheelers are encouraged by policies and innovative products

The report said that strong charging infrastructure is the key enabler for EV adoption and penetration, and pointed out the insufficient infrastructure in the country

The sales of electric two-wheelers will jump to 78% of the total two-wheeler sales in the country by 2030, helped by government policies, technology, infrastructure, and consumer acceptance, a report by Redseer said.

With better features, superior economics in terms of running cost and being more eco-friendly, electric two-wheelers are expected to see higher adoption in contrast to internal combustion engine (ICE) vehicles, said the report.

“Interestingly, the negligible need for maintenance and minimal fuel costs is also attracting B2B players to explore electric two-wheeler adoption as a clean mode of commercial operations,” Mukesh Kumar, Engagement Manager at Redseer Strategy Consultants, said.

Redseer also suggested in its report that the early adopters of electric two-wheelers are encouraged by policies and innovative products. It said that an inflection in the growth rate would be driven by an overall strengthening of the charging ecosystem, which would also result in sustained growth of the electric two-wheeler market in India.

“Although emerging strongly, it is not without its challenges – long charging time and poor charging infrastructure are the two main pain points for both users and non-users,” said Kumar. “However, because of government incentives and growth in the segment, several startups along with government bodies are building a better charging infrastructure in India.”

The report said that strong charging infrastructure is the key enabler for EV adoption and penetration.

However, India currently has only about 3,000 EV charging stations, which is around six available charging stations per 1,000 EVs, the report noted. In sharp contrast, China, which has the highest number of EV manufacturers, has about 200 charging stations per 1,000 EVs.

In fact, as per the latest government data, over 13 Lakh EVs are currently running on Indian roads. However, under the phase-I of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) India Scheme, 479 charging stations have been installed in India, as of July 1, 2022.

On the other hand, out of the 2,877 EV charging stations sanctioned by the Ministry of Heavy Industries under phase-II of FAME, 50 charging stations have been installed so far.

While the total number of charging stations installed so far in the country would be much higher than this with private players also coming into the picture, the number of operational public charging stations is still low. A few industry leaders also told Inc42 recently that the government initiatives are commendable, but the execution could be faster.

Separately, pointing out the market dominance by a few players, the Redseer report also noted that while over 150 electric two-wheeler players currently exist in the market, it is dominated by the top nine players – Ola Electric, Ather Energy, Hero Electric, Okinawa Autotech, Hero Electric, Bounce, Pure EV, among others.

“A very long tail of unorganised assemblers, importers & other such brands currently exist; as the market matures, these players shall face strong competition from established core players,” the report added.

Following several fire incidents, the vehicle registrations of many EV players has seen a month-on-month decline in the recent months.

Following a 27.3% MoM decline in May, Ola Electric’s registrations declined 36.5% in June to 5,874 units, as per Vahan data. Okinawa Autotech’s registrations also dipped 25% MoM to 6,980 units in June from 9,305 units in May. In April, its vehicle registrations stood at 11,014 units.

After multiple fire incidents with electric two-wheelers, the Ministry of Road Transport And Highways and the Central Consumer Protection Authority had issued notices to the companies in question.

In May, Union Minister Nitin Gadkari said that India will have 3 Cr EVs in the next two years. Meanwhile, a NITI Aayog report noted last month that in an ‘optimistic scenario’, there will be 100% penetration of electric two-wheelers in the country by FY27.