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India Electric Passenger Car Market Overview
The Indian electric passenger car market is poised to grow significantly during the forecast period, much of which can be owed to the incentives offered by government for vehicles with clean fuel technology. The government’s stringent emission norms and regulations have also helped to boost the sales of electric passenger cars in the country.
On the basis of product, the electric passenger car market is categorized into hatchback, sedan, sports utility vehicle (SUV), and others. The hatchback category is estimated to hold the majority market share and dominate the market during the forecast period. The hatchback cars are compact and usually have lower cost than the sedan, SUV, and multi utility vehicle (MUV), making them the popular choice among the consumers of electric passenger cars.
Based on the technology, the electric passenger car market can be categorized into: battery electric vehicle (BEV), plug-in hybrid electric vehicle (PHEV), and hybrid electric vehicle (HEV). The BEV category dominated the market in the historical period owing to availability of considerable number of BEV model. With the ongoing research and development in the battery technology, the cars under the BEV category are likely to get cheaper and more efficient, which are further expected to benefit the BEV market during the forecast period.
Among all the regions in the country, the western region is poised to dominate the electric passenger car market in the coming years, owing to the high disposable income of the people and early adoption of such vehicles in the region.
India Electric Passenger Car Market Dynamics
The electric passenger car market in India is predominantly driven by the government incentives in the form of subsidies and tax refunds. In January 2013, the Indian government launched the National Electric Mobility Mission Plan (NEMMP) 2020 to achieve national fuel security by encouraging the adoption of hybrid electric and pure electric vehicles in the country. Under this plan, the government provides fiscal and monetary incentives to the concerned transportation authorities at the state level in order to increase the adoption of electric vehicle across the country.
Also, stringent government norms and regulations pertaining to the rising air pollution levels have contributed to the growth of these vehicles in the country. The government had proposed to replace 30% of the traditional vehicle by electric vehicle by 2030 which is expected to benefit the electric passenger car market during the forecast period. Besides these, the government initiatives toward the development of efficient charging facilities network and indigenous production of technologically advanced lithium ion-based batteries for such vehicles are further boosting the sales of electric passenger cars.
The major factors restraining the growth of the electric passenger car market in the country are inadequate charging infrastructure and range of such vehicles. As the name suggests, these vehicles run on electric energy supplied by the batteries installed in these vehicles. To charge these batteries, charging outlets are needed. At present, these charging outlets are scarce, considering the number of electric vehicles on the Indian roads. This leads to the issue of range anxiety among the buyers/consumers.
Although the OEMs are working toward introducing batteries that could provide much longer range, the sourcing of raw materials and technological challenges seem to be the major hindrances in this process. The lack of awareness among the common masses and their perception about such vehicles further adds to the woes of the electric passenger car market.
India Electric Passenger Car Market Competitive Landscape
The electric passenger car market in the country has a few established players. Other conventional automotive OEMs are also gradually entering this industry, anticipating the market demand for such vehicles. Although the Indian electric passenger car market is in its nascent phase, increasing efforts by the government entities toward the establishment of charging infrastructure and localization of battery production across the nation have encouraged the OEMs to manufacture such vehicles in India. Some of the major players in this industry are Mahindra & Mahindra Ltd., Mahindra Electric Mobility Ltd. (formerly known as Mahindra Reva Electric Vehicles Pvt. Ltd.), Tata Motors Ltd., BMW AG, and Toyota Kirloskar Motor Pvt. Ltd.