India is slowly warming up to the idea of electric vehicles. However, owing to the lack of alternatives in the mass market segment, the demand is yet to pick up the pace. Maruti Suzuki India MD and CEO, Kenichi Ayukawa, the country's largest automobile manufacturer, which plans to introduce its first all-electric car in India by 2020, recently said in an event that sales of electric vehicles are more important than the subsidy offered in the localization of parts. He further added that automobile manufacturers in India should focus on generating demand across all segments.
Hybrid vehicles have plenty of common components with an electric vehicle. These include the battery, motor, an inverter to name a few. Ayukawa said that focusing on increasing volumes for the hybrid vehicles is further going to help in increasing the localization of these parts. He added that the largest factor which helps in localization is volumes, hence it is even more important than subsidy. The focus on increasing volumes should expand to each and every segment like commercial vehicles, passenger vehicles, two-wheelers and three-wheelers.
Talking about the commercial vehicle segment in general, to increase numbers, state transport corporations can be asked to add electric buses to their fleet. Government has launched the second phase of FAME-2 scheme in April this year. The scheme has an outlay of Rs 10,000 crore to encourage adoption of electric and hybrid vehicles, the government has made it mandatory for electric vehicle manufacturers to use locally made key auto components to avail subsidy benefits. However, EV manufacturers are against the move and have asked the government to consider doing away with the 50 per cent localisation condition for availing EV incentives.