Renault Kwid electric to launch in China, will the new GST structure enable its entry to India

The Goods and Services Tax or GST firms up the Government's vision to go completely green by 2030 in order to reduce pollution and oil import. One of the most popular hatchbacks in the country, the Renault Kwid is soon to be introduced in China with an all-electric powertrain and India could be on the map as well

By: | Updated: July 10, 2017 5:59 PM
Renault Kwid Climber Edition. Image for representation purpose only

Time and again there are some cars that make a brand popular and the Kwid is one such car, which made Renault popular in the mass-market segment, particularly among the young buyers of the country who wanted more features in their first car. Featuring a touchscreen infotainment system with Bluetooth and other facilities that were available in cars a segment above, accelerated the Kwid's sales figures. It still has a lot of ground to cover as the Alto brand remains the top car in its segment. Adding to the Kwid lineup now is the all-electric Kwid. This version, however, is currently being considered for China only according to a report by The Nikkei. The Renault Kwid EV is expected to be introduced by 2019 in China, as the country offers considerable subsidies for electric cars. The platform on which the new Renault Kwid EV's platform will also be shared with its global alliance partners, Nissan and Mitsubishi Motors. Hiroto Saikawa, CEO, Nissan told The Nikkei, “The idea is to design a compact car in segment A class (or the entry-level segment) for urban dwellers who only drive short distances.” In order to keep the price competitive, the alliance is contemplating of outsourcing the production to a local carmaker. It is expected to be around 1.5 million yen (approximately Rs 8.50 lakh) which is half the price of the Nissan Leaf hatchback currently sold in the country.

Nissan's local partner Dongfeng Motor Group would be the most suitable for local production of the Kwid electric as well as other models from Nissan and Mitsubishi. The high subsidies on electric cars in China has also encouraged other carmakers to bring in their electric cars and most likely produce them locally to keep the price competitive. Honda Motor is expected to bring in an affordable electric car by 2018 to China while Toyota Motor has stated a possible EV production in the coming years in China. The subsidies by the Government in China has also made it the largest electric car market globally.

Also Read: Renault launches Kwid ‘Live For More Collection’ edition

For India, the current tax structure in the form of GST hasn't worked in favour of hybrid cars, which were taxed earlier at approximately 30.3 percent but will now attract 43 percent tax. But, for electric cars, the GST council has set a 12 percent tax range under the new scheme compared to 28 percent flat GST for conventional and hybrid vehicles. The Government's New India vision that was projected by Prime Minister Narendra Modi at a meeting in NITI Aayog also bolsters the push for electric vehicles not just in the passenger vehicle category, but in the commercial category as well. Union Minister of State with Independent Charge for Power, Coal, New and Renewable Energy and Mines said, “We are going to introduce electric vehicles in a very big way. We are going to make electric vehicles self- sufficient like UJALA. The idea is that by 2030, not a single petrol or diesel car should be sold in the country.” The challenge for India, apart from the acceptability in consumers for electric vehicles will be establishing the required charging infrastructure. Unless, a wholesome approach is taken to encourage the adoption of electric vehicles, carmakers will have a tough time developing electric cars for India and selling them here.

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