'More OEMs in India have to come into EVs. It cannot be just one OEM selling one vehicle.'

Dr Pawan Goenka, Mahindra & Mahindra's executive director, speaks to Sumantra B Barooah about the Indian government's recent move to promote electric vehicles (EVs) and shares his views on what it takes to build an EV industry.

The government has announced an amount of Rs 75 crore for the National Electric Mobility Mission Plan (NEMMP) 2020. Will this money have any impact at all?
I think the key word here is ‘an initial amount’. That’s what was said and I am presuming that it will not stop at Rs 75 crore. Right now, the government is going to announce some kind of per vehicle incentive and if the vehicle sales exceed Rs 75 crore, they’ll probably bring in more funding. That’s what I have been assured.

So I am not so concerned about the Rs 75 crore amount. I am just waiting for what kind of incentive scheme will be announced shortly.

But in terms of direction and customer preference, do you think we are on track to seeing a sizeable volume of EVs on India’s roads by 2020?
It is not going to happen because of one announcement by the finance ministry. It will require a sustained effort by the OEMs, by the government to promote EVs and also creating, from the consumers’ viewpoint, a pull for the product. Not just because it’s an electric vehicle but because it gives them a lifestyle that they feel better about. All this has to happen together.

There are a few countries where electric vehicles are doing well, but very few. I have always believed, and have been saying this for the last 3-4 years, that India can take a lead in electric vehicles if we put our mind to it, because Indian electric vehicles are relatively inexpensive and reasonably comparable to their petrol and diesel siblings in terms of performance and customer comfort.

Therefore, we do have an opportunity to take a lead in electric vehicles provided the efforts that are being put in are sustained over a long period of time and everything comes together – the OEMs, suppliers, government and consumers.

Sustainability is key but if we look at Mahindra Reva as a business enterprise, it has sustained for quite some time. But how long can it go on without finding a good market for its product?
We are committed to it. Of course, we would have been much happier selling 500 a month than 70 a month. But I do believe that the day will come. I would wait to see what happens after the announcement of subsidies and I do expect to get a quantum jump in overall sales volume.

Also, I think more OEMs have to come into this field. It cannot be just one OEM selling one vehicle. Only then will it lead to more awareness. Today, people do not know about EVs and whether it’s only Mahindra selling or Tata selling, there’s no awareness. Tomorrow if there are six OEMs who all talk about EVs, promote EVs, then everybody will benefit from it. So, I would like more competition here!

Will you keep infusing funds into Mahindra Reva?
We will continue to do that till we give up but we are not ready to give up yet.

What has been your experience in Bhutan which has already acted on its emission-free transportation policy?
We thought that Bhutan will be a good electric vehicle market, but not much has happened. In fact, we are doing a little better in Nepal which means selling 3 to 4 vehicles a month.

In the past three months, we have seen a reasonable pull developing for EVs in India. This happened after we launched the power steering version. That made a big difference in the customers’ preference to buy EVs. Also, we have increased the range of the car from 100km to 120km. Both factors combined have allowed us to increase our sales.

Is the pace of evolution making you think of pushing more into overseas markets?
I am not going to talk about either/or. We have to push in India, no matter what happens and we really cannot develop a product only as an export vehicle. It has to be supported by the Indian market and we have to push exports separately. So it’s not that because India is not developing that we have to export.

So do you think the hybrid is the most realistic solution in the short term?
Well, it depends on what you are looking for. The hybrid certainly is cleaner than pure diesel and petrol and it gives better fuel efficiency. But the EV is zero emission at the consumption point, which the hybrid is not, and the electric vehicle is totally free of crude oil import.

So to that extent, electric vehicles have much more to offer. But at the same time, an electric vehicle requires a change because the range will not be same as a hybrid or a petrol/diesel car. It will always be a compromise.

Cost-wise, I think hybrid and electric will be almost the same because hybrid has a lower battery cost but it needs an engine. In comparison, electric has higher battery cost but doesn’t require an engine. So the delta price difference will not be that much.

Tesla had opened its patents to be explored by other players. Did it benefit Mahindra Reva?
To us it makes no difference.

When do you plan to introduce the e2o in Europe?
It will take about six months before we can launch it. We will start with the UK.