Recycling and affordability of EVs take centre-stage at SIAM Convention

The Centre must come out with a positive solution for recycling electric vehicles, batteries and motors to ensure a clean and green environment, said Venu Srinivasan, Chairman & Managing Director, TVS Motor. 

He was speaking at the Special Plenary Session 2 – 'Outlook of Indian Auto Industry and Its Role in India’s Economic Growth' at SIAM’s annual convention on Wednesday. “We are facing a crisis of existence as a nation, world, and humanity. We have never seen such climate change (variations) and so many natural calamities. We have to do more with the use of cutting edge technology,” said Srinivasan. 

Yet, at the same time, there was no other alternative than to reduce, reuse and recycle. The TVS Chairman said that with the whole industry moving towards EVs, it was important for the Centre to look for positive recycling options like the conventional engine. “Recycling for EVs is vital," he stressed.

According to Srinivasan, Li-ion is a scarce resource and causes pollution both when mined and disposed of. There was a need to use renewable energy sources rather than existing ones without affecting the environment. “We have to do it cautiously, in an optimal manner, where the consumer can absorb the change,” he said.

RC Bhargava, Chairman of Maruti Suzuki India agreed that customers in India needed to get modern and clean vehicles. “However, to follow all the European standards comes at a price. How do we make cars affordable and reach people whose incomes are low?” he wondered. While supporting the cause of EVs, Bhargava said the term “affordability” created some doubt. If car penetration had to grow in this country, it would require millions of cars to be made every year.  

"Are you sure we have that high number of customers (for EVs)? This is often ignored.” He said the Centre should look at reducing tax on CNG vehicles, as is being done with EVs, to incentivise its clean air drive .

Srinivasan also drove home the point that the automotive industry had contributed immensely towards revenue and growth of the economy. However, recent safety and emission norms along with other regulations had increased prices of vehicles over the years and in turn burnt a hole in the pockets of both consumers and OEMs.

“Moped prices have gone up by 40-50 percent in the past 3-4 years due to the move to BS IV and BS VI, addition of ABS and a high 28 percent tax on even the most basic automobile. This has created a sticker shock amongst consumers,” he said.

Bhargava pointed out that the GST rates in India were higher than those prevailing in Japan or the European Union. Additionally, the one-time road tax imposed by states  had only increased the price tag of vehicles “People are finding it more difficult to buy. Customers do not just buy a two-wheeler by choice — it is the only affordable mode of transport they can afford,” he said. 

In his view, people should worry about the price hike which also made him wonder whether the old belief of a car as a “luxury product and to be owned only by the rich” was still valid. “The car industry in India became modern and started growing after Maruti came into existence. The growth happened because people had an aspiration to own cars,” said Bhargava. 

According to him, there was no “concrete action” coming in from the Centre to ensure revival in the automotive segment. “Despite various statements that the industry is moving forward, there is a reverse trend and the industry has been in decline for a longer period,” he said. 

Revenue secretary, Tarun Bajaj, reiterated that the Centre recognised the role of the auto industry and its contribution to the economy. According to him, it was important for automakers and the Centre to work together on its revival. 

Bajaj also wondered how SUVs had managed to buck the trend at a time when sales of compact cars, two/three-wheelers and commercial vehicles had slumped. “SIAM should work on a deeper analysis and we can work together for the change,” he added.