Electric Vehicle sales grow in India but awareness level still low: SMEV

by Sumantra B Barooah , 08 Jan 2016


Green machines: a Mahindra Reva e2O and a Hero Photon.

Amidst news about steps to tackle air pollution and new emission norms that have created a stir among automotive industry players in India comes some welcome news, at least for a handful of automotive companies. 

The struggling Indian electric vehicle (EV) industry is witnessing some growth during the current fiscal year. From a level of "7,000-8,000" units during April - December 2014, India has seen sales of 21,000 EVs during April-December 2015, according to Sohinder Gill, director - corporate affairs, Society of Manufacturers of Electric Vehicles (SMEV). The figure for hybrids during April-December 2015 stands at 18,000 units. The current EV sales volume is still way behind the peak of 85,000-100,000 units notched during 2011-12.

The growth in the EV market can be attributed mainly to the incentives under the government's Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles India programme which was launched on April 1, 2015. The full impact of the programme nationwide is yet to kick in as it was rolled out across the nation only from October 2015. Till then, it covered only 100 cities. Gill is hopeful that the EV industry will reach a level of 35,000 units by end-March 2016. The sales projection for 2015-16 is 60,000-70,000 units.

Apart from the price factor, the lack of awareness about EVs is a key reason for the very slow offtake of EVs, according to Gill, who is also the CEO of Hero Electric. "Awareness continues to be abysmally low. Large scale awareness programmes should be conducted by the government. Individual OEMs will concentrate only on limited markets where they are present," says Gill, who also shares that only 30 percent of customers in India are aware about EVs. That should be tackled first followed by the benefits of the FAME India programme.

After the launch of the FAME India programme, manufacturers are also returning to the market. At its peak, SMEV had a membership of around 20 serious players. This figure had dropped to 6 or 7 and it now stands at 12. During 2010-12, the Ministry of New and Renewable Energy (MNRE) had implemented an Alternate Fuels for Surface Transportation Program (AFSTP), at a total expenditure of Rs.95 crore. The EV industry was a beneficiary. But after its withdrawal, the market crashed and around 1,000 dealers and 7-8 manufacturers shut down their EV business.

The latest figures reflect that the EV industry in India could be heading towards better times. Gill is hopeful that the Delhi market, once the largest for EVs, will see more EVs on the roads as the state government is showing interest in promoting green vehicles. Hero Electric, on its part, is taking the current air pollution situation in the capital city as an opportunity to promote its green vehicles. A fleet of 100 electric scooters to offer free rides has been put on the roads of Delhi, where currently half of all the vehicles are off the road every day due to the state government's odd-even rule. From January 1-7, these e-bikes had completed 6,000 free rides, says Gill.

Gill says that for the EV industry to gain proper traction, central and state governments have to lend a helping hand in areas such as building awareness, developing charging infrastructure and taxation.