Is the Indian car/bike industry ready to move from petrol/diesel engines to electric vehicle technology?

Industry experts believe that there is a requirement for a strategic transition plan for the automobile industry to impact the sustenance of electric vehicles. This will allow the phased implementation of electric mobility milestones in India.

By:December 8, 2020 4:30 PM
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The going has been slow for the electric vehicles segment with sales limited to around 1 per cent of the overall car and bike sales. However, with more and more OEMs warming up to sustainable mobility as the future and the government encouraging growth of EV infrastructure through implementation of initiatives under Fame I & II, there is definite potential for promising growth for the segment. The EV industry has been growing and domestic sales were up by 20 per cent despite the pandemic. Industry experts believe that there is a requirement for a strategic transition plan for the automobile industry to impact the sustenance of electric vehicles. This will allow the phased implementation of electric mobility milestones in India, and provide an opportunity for ICE and electric vehicles to coexist in the coming years for a smoother transition towards sustainable mobility.

Through this plan, the industry can move towards a clean transport and mobility system and bring about self-sufficiency in renewable energy.  The transition to electric mobility is not limited to the environment but also about augmenting jobs and growing the economy. The government’s aim of converting ICE automobiles by 2030 would require a large number of skilled professionals. With the process of manufacturing EVs, the mechanical components will be replaced with electrical and electronic components, which will require a major shift in skills required. Currently, we have a higher percentage of skills from the mechanical side, compared to those from the electrical side, which is essential for EV transition. EVs are expected to grow in popularity and are cleaner and more resourceful which will make India globally at par for an electrified future.

Apart from the central government scheme, the launch of a progressive policy would further strengthen the EV market in India. The switch from ICE to EVs will take time but it will create new opportunities to make the components for EVs. New technologies will come into existence and the necessary skilling will definitely need to be updated.

Here is what the industry experts say of this situation

I feel the ICE industry has huge skills gaps in its transition to EV. This need was considered critical and urgent and was a crucial weakness for most if not all the ICE industry players. However, due to the slowdown in the adoption of EVs – due to various reasons – the ICE industry has been given a second chance to fill these gaps in skills. EV is certainly going to come. The skill gaps for EV (and hence the need for skill development) is not horizontal but vertical. It is not like going from BS4 to BS6 and having the entire ICE industry and it’s an ecosystem to learn about after-treatment of exhaust and on-board diagnostics, etc. EV is completely different. Batteries, Motors, Inverters, Control systems, Software – all have many permutations and combinations. And then, these are just the technology part. The supply chain is another part, business in EV through “shared” principles is yet another part. It’s going to be an extremely challenging few years for the ICE industry for this transition, but equally a superb learning opportunity for all the professionals.

– Vinod Dasari – CEO, Royal Enfield

The ICE industry is in an accelerated zone towards electromobility solutions, by securing desirable sustainable products with the right quality, leveraging new and well-known technologies, partnerships, and digital innovation. Competencies shall be required to be built in the areas such as Driveline, Platform, System Integration, Control Systems, Embedded, Electrical Motors, Charging Systems, Storage Systems, etc. To ensure talent supply, organisations are working with Engineering institutes towards modifying the curriculum of traditional Engineering streams towards these new age skills. They are also internally focusing on developing employees with embedded skills towards these new Electromobility related areas. In the new era, building Partnerships shall also become an increasingly important aspect of leveraging the available skills’ ecosystem. Partnerships with start-ups, academia, specialized organizations, and independent consultants shall ensure the availability of the deep expert competencies and capabilities in several new areas; speed in the development and execution of the projects; and access to new markets, customers and/or technologies to enable new business. On the whole, industry needs to have this multi-pronged approach towards preparing itself for the transition to EV.”

– Amit Sharma, CHRO, Volvo Group India

 

The ICE industry has been there for the last 120 years and although the EV industry did evolve at the same time but commercially didn’t get conceptualised. Now we are at a certain stage when the world is talking of EV replacing the ICE. However, we are lagging far behind and the budget which is earmarked is unlikely to be spent. If you look at the four-wheeler front, companies are doing volumes of double digits.  I would say there’s a lot of intent and a lot of MNCs who are world players who are having very aggressive EV plans in other countries are somehow adopting a wait and watch policy. In India, 84 per cent of the market is between three-wheelers and two-wheelers. The potential is very high and there is no shortage in terms of the number of players but if you look at the volume of last year which was 1,50,00-1,60,000 which is a very low volume and 80 to 90 per cent of this is beyond the purview of the FAME-II. No critical mass is getting built so this is a time for introspection. The maximum optimism is on three-wheeler because (1) the usage is much higher unlike a normal two-wheeler or a four-wheeler where the usage is between 600 to 900km a month here the usage is about two and a half to three thousand kilometres. (2) There are fixed locations where they operate so you can have a fixed way wherefrom charging it can be done. With the FAME policy, the intent is honourable and the direction is invulnerable but either the bar too high or the industry is not able to match to it or the customer pool is not coming but we are lagging far behind and that’s a question which we need to answer ourselves.

– Arun Malhotra, auto industry veteran and former MD, Nissan India

In the long term, the transition to EVs is definitely inevitable. However, if we see the current circumstances, two major factors have pushed EVs to a backseat. Firstly, China is still a major supplier for electrical vehicles and with the conflict in the Indo-China relations and consequent import restrictions would lead to a setback in the adoption of EVs. Secondly, EV development in companies is still in the initial stages and would require significant investment decisions. With the pandemic, manufacturers have been pruning their investment strategy and EVs would fall back in. We will have to go slow on the transition to EV but it is the way to go if we look at the longer horizon.

– Nikunj Sanghi, Chairman, Automotive Skills Development Council

 

Considering the price-sensitive nature of the Indian consumer that got amplified post the pandemic, EVs would not become the norm unless the industry achieves the critical mass of production to bring costs lower than that of ICE. We hope to see initial adoption with commercial vehicles with incentives supported by FAME-II, but passenger vehicles industry is a long way to go in adopting EVs.

– Deepshikha Kumar, founder, SpeakIn

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