India and its role in the global electrification of the automotive industry | The Financial Express

India and its role in the global electrification of the automotive industry

Compared to other automobile segments, the light mobility segments like two-wheelers, three-wheelers, and small commercial vehicles, as well as the mass mobility segment like public transport buses, offer a much greater and immediate opportunity in India.

India and its role in the global electrification of the automotive industry

Anil Kumar M R

The demand for cleaner forms of mobility is increasing, with consumers, governments, and automotive  OEMs looking to decarbonise the transportation sector. In parallel, the necessary ecosystem is being developed to enable faster adoption of electric vehicles and a quick shift towards green mobility. 

Accordingly, the electric powertrain is inevitable in the long-term for a sustainable future for Automobiles globally – and in India. Like global markets, India is also fast-tracking the adoption of electric vehicles through FAME from the union government and other supportive schemes from the state government.

Compared to other automobile segments, the light mobility segments like two-wheelers, three-wheelers, and small commercial vehicles, as well as the mass mobility segment like public transport buses, offer a much greater and immediate opportunity in India. This is due to the drive/usage patterns and a lower dependency on supporting ecosystems like the public charging infrastructure.

We already see a quickly rising penetration of electric variants among these vehicle categories. For example, the electric two-wheeler segment had a penetration of less than 0.5% in 2020 compared to its ICE  counterparts. This doubled to 1% by the end of 2021, jumped to 3.7% in the first two quarters and is expected to climb to ~5% by the end of 2022. Over the next 5 years, the share could increase to 25-30%. 

Similarly, the electric three-wheeler (L5) segment was at 0.5% and 2.7% market share in 2020 and 2021,  respectively. It’s now already grown to 6.8% in the first two quarters of 2022, and can easily reach a  share of 35-50% over the next five years with consistency in policy and support incentives.

Electrifying these segments will also create a foundation for India and the automotive industry for a  much-needed ecosystem for the electrification of other major automotive segments. It is also a great opportunity for our economy: By fast-tracking adaption, introducing new efficient technologies and achieving economies of scale India can become a global leader in the electric two- and three-wheeler markets and thus support the world in the transition to an electric powertrain. 

The Author is Anil Kumar M R, President and MD, SEG Automotive India

Disclaimer: Views expressed are personal and do not reflect the official position or policy of Financial Express Online. Reproducing this content without permission is prohibited.

Get live Share Market updates and latest India News and business news on Financial Express. Download Financial Express App for latest business news.

Photos
14 Photos
G20 Presidency: Rare Photos from all-party meet, chaired by PM Modi
11 Photos
‘The festival of democracy’ – Modi votes in Gujarat 2nd phase! See PHOTOS
11 Photos
Gujarat Assembly Election 2022: The Festival of Democracy – In PICS