Why electric cars don’t make sense in India

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TATA Motors Started Rolling Out Tigor EV With Power-Train From Electra EV

Electric cars are a thing of the future according to the industry experts and solicitors. Tesla, Chevy, BMW, Nissan have already conquered the roads in America and Europe with their fully electric vehicles. Electric cars come with a high range of sophistication and AI-based intelligence to make them look like a prop from star wars but in actual sense, the concept of an electric car is 110 years old. With this growing interest in electric vehicles, we are taking a look at where this technology began and why it isn’t feasible in a country like India

The DODO was the world’s first commercially produced electric car

History Lesson!

The first electric car in the United States was developed in 1890-91 by William Morrison of Des Moines, Iowa; the vehicle was a six-passenger wagon capable of reaching a speed of 14 miles per hour (23 km/h). It was not until 1895 that consumers began to devote attention to electric vehicles after A.L. Ryker introduced the first electric tricycles to the U.S, by which point Europeans had been making use of electric tricycles, bicycles, and cars for almost 15 years. Interest in motor vehicles increased greatly in the late 1890s and early 1900s. Electric battery-powered taxis became available at the end of the 19th century. In London, Walter C. Bersey designed a fleet of such cabs and introduced them to the streets of London in 1897. They were soon nicknamed “Hummingbirds” due to the idiosyncratic humming noise they made

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Worldwide discoveries of large petroleum reserves in the Gulf led to the wide availability of affordable gasoline, making gas-powered cars cheaper to operate over long distances. Electric cars were limited to urban use by their slow speed (no more than 24–32 km/h) and low range (50–65 km), and gasoline cars were now able to travel farther and faster than equivalent electrics.

California electric car maker Tesla Motors began development in 2004 on the Tesla Roadster, which was first delivered to customers in 2008. The Roadster was the first highway legal serial production all-electric car to use lithium-ion battery cells, and the first production all-electric car to travel more than 200 miles (320 km) per charge. Since 2008, Tesla sold approximately 2,450 Roadsters in over 30 countries through December 2012. Tesla sold the Roadster until early 2012, when its supply of Lotus Elise gliders ran out, as its contract with Lotus Cars for 2,500 gliders expired at the end of 2011. Tesla stopped taking orders for the Roadster in the U.S. market in August 2011 and the 2012 Tesla Roadster was sold in limited numbers only in Europe, Asia and Australia. The next Tesla vehicle, the Model S, was released in the U.S. on 22 June 2012 and the first delivery of a Model S to a retail customer in Europe took place on 7 August 2013. Deliveries in China began on 22 April 2014. The next model was the Tesla Model X. In November 2014 Tesla delayed one more time before the start of deliveries to retail customers and announced the company expects Model X deliveries to begin in the third quarter of 2015.

electric car price chart
Price comparison of EV batteries

Electric vehicles were made to cut on the carbon print of the transportation. Unlike Europe and America where 70% of the energy is produced through renewable sources and nuclear power plants, in India most of the electricity is generated using coal-powered thermal power plants. If every car owner were to use an electric car, in the long run, this would cause more environmental damage than the conventional gasoline car. Mahindra partnered and later on bought Reva the electric vehicle pioneer which was capable of making electric vehicles for Indian roads but the carbon emissions were still an issue. According to reports if thermal electricity is used to charge an electric vehicle it pollutes more air than driving an inner combustion diesel engine for the same distance.

There are also other factors because of which electric cars aren’t popular in India.

Infrastructure for electric cars

Electric cars run on electricity, and to charge them we need a lot of public charging points. Until we have enough public charging outlets, it is not easy to have and maintain an electric car in India. Not many in India have access to electricity all the time. Even if it is a city, the chances of a blackout are higher than the developed countries. The situation is changing but is still a long way off.

tesla charging point
Tesla supercharging station

Range Anxiety

Range anxiety is a problem that has plagued the development of electric cars around the world. When a fuel car can be fully topped off in 10 mins, electric cars need a lot longer to be recharged. This problem is now diminishing as we have faster-charging options like the Superchargers and DC fast chargers, however, they again require infrastructure.

Electric cars range
Range Anxiety

Mindset and Stereotypes

 India has only seen electric vehicles which are mere experiments and toys of the geeks. No cars have yet been introduced which could compete with the performance and practicality offered by gasoline-powered vehicles. This has created a mindset in India, that electric cars cannot serve the purpose of commuting.

Mahindra e2O
Mahindra e2O

Lack of Innovation

Considering the above reasons, no manufacturers have started making electric cars in India, they probably are waiting for a company like Tesla to enter the market and set up an infrastructure for charging them. However, considering the taxes on imported cars in India, it will never make sense for any company to sell cars in India manufactured elsewhere. Until a facility to build electric cars is set up, the costs will be exorbitant.

The most memorable electric car in India

Price sensitivity:

Electric cars at an average cost more. An electric car to be compelling enough will be at least 15–20 lakhs, that too after being manufactured in India. Now considering the costs and existing electric cars, Teslas cost over 50 Lakhs, even the cheapest ones cost over 20 lakhs. In the Indian market, the average cost of the vehicles is 6–7 lakhs compared to the western markets where it is around 15–20 lakhs.

Pricing of Electric cars and Hybrids
Pricing of Electric cars and Hybrids

Support for indigenous factories

Elon Musk said in a tweet that as per regulations, 30% of the parts need to be sourced locally and the supply is just not present so far. He is right and even now this remains a fact, it would be difficult for any car manufacturer to open up manufacturing facilities in India. The government will need to make a push to incentivize local businesses into creating the supply needed for this change – both in terms of capability as well as quality.

Elon Musk Tweet
Elon Musk’s Tweet

India’s game plan

State-run firm Energy Efficiency Services Ltd (EESL) has been tasked with the job of triggering early adoption of electric vehicles. The newly-created firm, which made a name for itself by reducing the price of LED lights for home lighting by 86%, floated a tender for procuring 10,000 electric cars, the largest such procurement in the world.

Tata Motors Ltd won the EESL contract, with Mahindra and Mahindra Ltd matching its bid and winning 30% of the order.

“There is a need to kick-start the market and that is what we have done with this 10,000 vehicles tender. It’s a trigger in many ways,” EESL managing director Saurabh Kumar said in an interview before the EV bid results were declared.

The vehicles will be procured at a per-unit price of Rs11.2 lakh with the aim of laying the foundation for a mass shift to EVs by 2030.

EESL’s business model is to make these vehicles available on lease to the government and its agencies for around Rs45,000 per month, which is Rs5,000 less than what is currently paid for petrol and diesel cars.

Tata Tigor EV
Tata Tigor EV

Taking a strong stance on electric vehicles, the Supreme Court asked carmakers to switch to electric mobility soon. The top Indian court was informed that as many as 22 electric cars by various manufacturers will make its market launch soon. It was further added that Indian companies like Mahindra and Tata Motors are pushing hard to bring in EVs into the Indian market. Even the goods and services tax (GST) Council has set a tax rate of 12% for electric vehicles, compared with 28% plus cess for petrol and diesel cars and hybrid vehicles. All of these factors do look enchanting for EV’s in India and over the next decade, mainstream manufacturers should adapt their line-up to a fully-electric range alongside conventional gasoline vehicles.

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