India’s electric vehicle revolution is stuck at 25kmph and Ather’s plan is for faster scooters

In the midst of the worst demand crisis the Indian automobile industry has seen, the EV industry seemed to have a lot to celebrate seeing significant growth. But some players involved are not impressed. 

By:April 22, 2020 3:33 PM

The Indian automobile industry hit one of the lowest points in its history in the 2019-20 financial year. Struggling to improve customer sentiment while demand for new cars dropped significantly, the Indian automotive industry saw their sales plummet in the last 15 months. However, it seemed customers interested in electric vehicles didn’t hesitate much. The Indian EV industry grew by 20% in the last fiscal.

The sales for electric vehicles grew from 1,30,000 units to 1,56,000 of which 1,52,000 units of them came from the electric two-wheeler segment alone. It’s clear then that India’s electric mobility will be driven by two-wheelers for a long time. Among the electric two-wheelers, it turns out the most popular kind of electric two-wheelers in India are scooters that make up 97% of it. What is even more interesting, 9 out of 10 of every electric scooter sold in India are all slow-speed models which are limited to a maximum speed of 25kmph.

This is due to the fact that these models are quite economical and affordable. Additionally, as per regulations, slow speed scooters with a max speed of 25kmph are not required to be registered, don’t require a two-wheeler license, and riders do not require helmets. Despite the fact that the low-speed E2W market is the largest market for EVs in India, some major players are not interested.

We got in touch with Ather Energy’s Ravneet Phokela, Chief Business Officer to discuss if Ather, one of India’s most popular start-up E2W maker, is interested in tapping the large section of the market with a slow-speed model. Phokela said; “Our focus continues to be on offering consumers a delightful ownership experience through well-designed and high-quality products, and we don’t plan to be in the low-spec end of the market. We don’t believe that is the right way to grow the market.”

Ravneet Phokela, Chief Business Officer, Ather Energy

He added; Today, lower performance spec electric two-wheelers make up a significant chunk only because of the lack of alternatives. We will witness a transition in the coming days with new and existing brands launching more efficient and powerful electric two-wheelers that are near-equal or better in performance than their ICE counterparts.”

On the growth front of the electric vehicle industry, Phokela said “While a 20% increase in EV sales is a healthy jump, we believe it doesn’t reflect the massive growth potential of the EV market, especially e2w. We’ve barely scratched the surface. The demand was always there, but it needed strong, well-performing products that are viable alternatives to ICE (Internal Combustion Engine) vehicles to unlock this demand.”

Ather Energy acknowledges that E2Ws account for nearly 97.5% of all EVs sold in FY20 and it’s a trend that it sees continuing.

Currently, the COVID-19 lockdown has halted manufacturing and sales across the nation. However, EV players in India believe that in the post lockdown period, the demand for EVs is likely to face favourable conditions.

Sohinder Gill, Director General, Society of Manufacturers of Electric Vehicles said: “While the EV industry is surely going to face the brunt of COVID-19 like any other automotive business, the clearer skies and the cleaner air in even the worst polluting cities is certainly leaving a permanent impression in the minds of the customers about how they can breathe easy and remain healthy if the society moves towards E Mobility.”

India’s adoption of electric vehicles has been slow, but numbers show it is growing steadily. With the infrastructure still in its infancy, the Indian consumer continues to tread with caution with EVs. Range anxiety and cost of electric vehicles have been the major deterrents for consumers transitioning to EVs. As electric vehicle technology is expected to improve and advancements in battery technology take place range anxiety and cost will see a reduction. Since both the improving battery technology and infrastructure to support EVs are taking place at a steady pace, the trust and demand for EVs will only increase.

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