Piaggio’s Diego Graffi: ‘India’s electric two-wheeler penetration will be 30-40% in 3-4 years’

With the theme of ‘Road to Greener Mobility’, Day 3 of Autocar Professional’s Two-Wheeler Week focussed on the dynamics of sustainability mobility solutions.  Diego Graffi, Chairman and MD of Piaggio Vehicles, in a discussion with Autocar India editor, Hormazd Sorabjee emphasised how higher fuel prices can accelerate EV adoption in the country.

Graffi said that the fuel costs have gone through the roof. “Petrol price has crossed Rs 100 a litre in India and vehicle prices have risen due to various reasons. Fear in the consumer’s mind is not allowing them to take advantage of the festive season. Let's us hope CY2022 turns out better."

Piaggio Vehicles' Chairman and MD also pointed out the market is shifting towards higher displacement vehicles in the two-wheeler segment. “These higher segments and the OEMs in the 125cc segment have been less impacted by the recent market downturn. We have seen growth for Piaggio also.”

Sharing his thoughts on the electric vehicles in the market, Graffi said that he is impressed with the electric two-wheeler sales in the last few months. There has been growth both in the B2B and B2C segments. He pointed out that it is impossible to think about the Indian two-wheeler industry without going electric.

“There has been a huge boost in electric three-wheeler sales from e-commerce and the last-mile cargo operators in India. Also, in two-wheelers there are two key aspects that have contributed to this growth. One, the high fuel price and FAME incentives and subsidies,” he said.

“We as a group are thinking on these lines and we could be planning a new product introduction in the next couple of years. In scooters, other than petrol or electric, there is no other powertrain solution as of now. There are talks about substituting petrol with ethanol. In scooters, electric will be a bigger alternative. Also, by 2024 around 30-40 percent can be electric, which is a segment we are looking at," Graffi added.

Newer players, better solutions
The electric two-wheeler industry is majorly occupied by start-ups. Will they survive when major OEMs start investing aggressively in the electric industry? Graffi believes that the new players help in technology development. According to him, the local players are the drivers of competition for everybody.

“Our strategy is to proceed with our know-how. We have our group for technology support. Also, scale is a must to invest. Being a niche player gives us an opportunity to grow. We have an advantage in sharing tech at the group level. For BS VI, we benefited from Euro 5 and it is the same for electricity. This helps keep development costs lower," he explained.

Pointing out the challenges he said that if there is an increase in localisation of supply chain which is a big constraint now it would help push the EV growth. “Also, the government incentives should remain at the same level and investment in charging infrastructure grows, then penetration of electric two wheelers in India will be 30-40 percent in the next 3-4 years," he concluded.