Maruti Suzuki well on time for EVs, adoption to take off from 2025, says Shashank Srivastava

Maruti Suzuki, the country's largest car maker says that the company gave up on diesel a long time ago and it is well "on time" for its electric vehicles, as it expects the adoption rate to accelerate post 2025.

The comment comes on the sidelines of the 63rd SIAM annual convention in National Capital post Nitin Gadkari's warning to automakers to move away from diesel and accelerate the transition to EVs. 

Shashank Srivastava, Senior Executive Officer, Sales and Marketing at Maruti Suzuki said, "Basis the evolution of electrification in some of the key evolved markets in Europe like France and Germany, it was observed that as penetration reaches 3.5-4% of the market, the segment then takes off. We expect that this will happen in India around 2025 and we will be there in the market."  

At present the electric vehicle penetration is at 2% - predominantly driven by Tata Motors who enjoys over 90% share. Come 2025, the mainstream market is likely to have close to a dozen models for the prospective buyers. 

Along with Maruti Suzuki, the likes of Hyundai, Kia, Volkswagen Skoda, including the homegrown car maker Mahindra & Mahindra and Tata Motors will have a flurry of new launches between 2024 and 2025. 

"We are at the right time and right place. We are building the ecosystem, we would like the adoption rate to go up and hence we are working on localisation of batteries and critical parts, charging infrastructure amongst others to ensure that our customers are not inconvenienced," said Srivastava.

While there are some critics who have opined that the market leader is late in the game, Srivastava said, sometimes there are advantages of coming in later, as one is very well aware of the "pain areas" of the consumers and you try and address them before entering the market.  

Maruti Suzuki will be launching its first mid-size SUV EV in the next financial year and sources say the start of production of its EV codenamed YY8 is scheduled for October to December quarter of 2024.

Two of those key factors are charging infrastructure and costs. On both those elements, the company is working on the solution and will share its strategy at the appropriate time, assured the company.

It is banking on higher localisation to ensure that the cars are accessible. And on its part Maruti's parent Suzuki Motor is investing over Rs 9000 crore on the localisation of batteries and the Japanese automaker has already committed to a portfolio of half a dozen electric vehicles by the end of the decade.

Srivastava expects the electric passenger vehicles to account for 17 percent of the overall market by 2030. And as part of its own strategic long term road map, Maruti Suzuki had guided for 15 percent EV contribution to its total sales of 3 million units by 2030, which will be closer to half a million cars or 4.8 lakh cars to be precise and strong hybrids accounting for a higher share of 25 percent, with the balance 65 per cent will be petrol, cng, flex fuel or ethanol cars.  

Why not levy lower taxes on CNG and Hybrid? 
Srivastava said Maruti Suzuki is working on over half a dozen powertrain options and as for electric vehicles, the company is adopting a complete ecosystem approach as against just launching an electric vehicle.

He elaborated that till the time electric vehicles become mainstream, the CNG and Hybrid powertrains cars are an ideal bridge to zero emission vehicles.
“Eventually we all have to move to EVs, but till the time all the enabling factors take shape, the CNG and hybrid cars are a good bridge to a cleaner environment. And since they are less polluting than petrol and diesel and they too should be favoured in terms of lower tax,” urged Srivastava.

Drawing a parallel to electric vehicles getting a gold medal i.e. (preferable tax structure of 5% GST), he argued that if CNG and Hybrids are lower on pollution and better than petrol or diesel, “why not give silver or bronze medals to these powertrains. By medal I mean lower taxes, since they are more environmentally friendly,” he added.