The electric three-wheeler (e-3W) industry is bracing for an intense race, with new players coming into play on the back of robust demand from last-mile connectivity segments. The e-3W market, which includes the cargo and passenger segments, has seen a significant increase in patronage as companies use e-autos for last-mile delivery. Another major driving factor is the fact that e-3Ws’ total cost of operation per kilometre is lower than the conventional internal combustion (IC) engine autos.
Sensing that the e-3W segment has big growth potential, Chennai-based Murugappa Group forayed into the electric vehicle (EV) space with the launch of its maiden product — a passenger e-three wheeler under the brand name Montra — and promised to roll out variants in the cargo segment soon.
Arun Murugappan, executive chairman, TI Clean Mobility, a subsidiary of Tube Investments of India and part of Murugappa Group, said e-3Ws are one of the EV segments with the biggest growth potential, and this foray will mark a new phase of growth and innovation for the company. The company has plans to produce 75,000 e-3Ws per year, and will scale up furter when volumes go up. “lnitially, we want to cater to the domestic market; we will take a call later when we would want to go for exports,” Murugappan said.
According to the latest EY-IVCA-IndusLaw study, there is a strong increase in the penetration of e-3W vehicles, with 5% penetration in the first quarter of 2022. The passenger segment currently has lower penetration because only a few models are available. Cargo models are expected to see more traction, largely due to two factors — an increase in e-commerce sales and last-mile deliveries, and commitment from Amazon and Flipkart to go completely electric by 2030.
Suman Mishra, CEO, Mahindra Electric Mobility, told FE that a positive trend the company has been observing is the increasing electric penetration in the 3-wheeler space. “From FY19 till now, we have seen a five-fold increase in our electric vehicle sales. MEML is the leading electric three-wheeler player in India with its e-Alfa and Treo range. Industry projections suggest we should reach 20-30% electrification for the L5 category by FY25 and 60-70% by FY30.”
Mishra said the entry of new players is being facilitated by the strong government policies for EVs, and competition is always good. It increases EV awareness amongst the customers and helps them to enjoy new features, as well as technology. Mahindra offers one of the most diverse portfolios of electric three-wheelers — the Treo and Alfa range — for the passenger and cargo segments. There are more than 800 Mahindra service touchpoints, currently unmatched by the competition.
E-3Ws cater to various upcoming segments in the load category. E-commerce players remain the major consumers but are closely followed by FMCG sectors. Many applications like medicine distribution, poultry, bakery, food chains, vegetables & fruit distribution and food carts are moving to e-3Ws due to low maintenance and operating costs.
Debashis Mitra, director, sales and marketing, Altigreen Propulsion Pvt Ltd, told FE that electric commercial mobility sales in India are surpassing past records and surging rapidly. The advancement of electric three-wheelers is gaining traction gradually. In category L5N (goods) models are slowly picking up with a 5% share owing to an increase in demand for last mile delivery. “Altigreen is a pure play electric manufacturer in the 3W L5 segment,we expect the 3W L5 segment should penetrate at 18% of the total market by F23,” he said.
According to him, since e-3Ws have been a growing segment, many new entrants will definitely be added. “Altigreen has never been afraid of competition and in fact, has welcomed many more EV players in our segment, as long as they create products that inspire confidence in EVs. It is our strong belief that many OEMs, each with good quality offerings, help to establish the market and then motivate the migration from fossil fuel to EV,” he said.
Samrath Kochar, founder & CEO, Trontek, a battery-maker for EVs, told FE the boost in demand for e-3Ws has led to a domino effect in the li-ion battery market as well.
Furthermore, Li-ion batteries are a preferred choice for OEMs because they are eco-friendly, lightweight, compact, have high energy density, low maintenance, more charge cycles, and a low self-discharge rate.“ These offer the choice to manufacturers to keep the battery size smaller and retain the same storage capacity. Moreover, most of the components of the lithium-ion batteries are recyclable, that makes it the best fit to develop a sustainable ecosystem,” he said.