India Electric Rickshaw Battery Market Overview
Valued at $335.2 million in 2018, the Indian electric rickshaw battery market is projected to advance at a CAGR of 13.4% during the forecast period. The proliferation of electric rickshaws on Indian roads and increased average age of these rickshaws are the major factors driving the growth of the industry. Due to the lower operating cost of electric rickshaws as compared to gasoline-fueled rickshaws and the government support in the form of subsidies and incentives to boost the adoption of these rickshaws, the electric rickshaw market in India has boomed substantially in recent years, propelling the demand for electric rickshaw batteries in the country.
On the basis of vehicle, the Indian electric rickshaw battery market has been categorized into batteries for passenger carriers and those for load carriers. Between the two, batteries for passenger carriers contributed the larger share to the market during the historical period, accounting for more than 95% revenue in 2018. Large passenger base in the country and the factor of last-mile connectivity associated with these vehicles benefited the growth of this category in the market.
Based on battery capacity, the Indian electric rickshaw battery market has been categorized into batteries with capacity less than 101 Ah and batteries with capacity more than 101 Ah. Of these, electric rickshaw batteries with capacity less than 101 Ah held the larger share in the market during 2014–2018, accounting for around two-thirds sales volume in 2018 owing to the end-user preference for low-cost electric rickshaws. High sales of these electric rickshaws can also be attributed to the dominance of unorganized, local players in the market, as most of these players manufacture low-cost electric rickshaws with lower battery capacity.
Between the OEM and replacement battery categories, the OEM category held the larger share in the Indian electric rickshaw battery market in 2014 and 2015. However, with the proliferation of electric rickshaws in the country and more vehicles undergoing battery replacement, the market has witnessed dominance of the replacement category since 2016.
In terms of sales volume, Delhi was the largest market for electric rickshaw batteries in the Indian electric rickshaw battery market during the historical period. The increase in demand for eco-friendly modes of transportation coupled with large commuter base led to the deployment of electric rickshaws in the capital, which, in turn, provided impetus to the demand for electric rickshaw batteries.
India Electric Rickshaw Battery Market Dynamics
Growing deployment of electric rickshaws on the roads of India and increasing average age of electric rickshaws are the two major factors fueling the growth of the Indian electric rickshaw battery market in the country. The number of electric rickshaws in India has increased significantly in recent years. This can be mainly ascribed to the support of the government in the form of incentives to boost the adoption of these vehicles in the country in order to curb environmental pollution. In view of this, the government plans to offer incentives on these eco-friendly and economical vehicles under its second phase of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles scheme, also known as the FAME-II scheme, which will be in effect from April 2019.
The Indian government will provide incentive of $735 (INR 50,000) on five lakh electric rickshaws with ex-factory price of up to $7,351 (INR 5 lakh). The total fund support from the Department of Heavy Industries (DHI) for the scheme is $367.5 million (INR 2,500 crores). Thus, the Indian electric rickshaw battery market is expected to be positively affected by the increased adoption of electric rickshaws in the country in the near future.
Lack of clarity on operational guidelines for electric rickshaws is one of the major factors hindering the growth of the Indian electric rickshaw battery market. Under the FAME-I scheme, the government offers incentives to increase the adoption of electric rickshaws in the country. However, due to the lack of proper rules and guidelines related to these vehicles, the sales have been impacted negatively. Also, these electric rickshaws are often considered unsafe and unreliable, owing to their light weight. Besides, only a learner’s license is needed to operate these vehicles. Thus, lack of regulations associated with these vehicles limits their adoption to some extent, thereby affecting the demand and market for electric rickshaw batteries as well.
Goods and services tax (GST)-driven market consolidation can be viewed as a growth opportunity by the organized players in the Indian electric rickshaw battery market. The electric rickshaw battery market is dominated by unorganized, local players. However, since the GST rollout, unorganized players have been largely hit by higher costs and the inability to offer a credit period of 45–60 days (the number of days given to a customer to pay an invoice) in the pre-GST period owing to increased accountability.
Unorganized players enjoyed a price advantage as high as 20%–30% before the GST rollout. However, after the rollout, all unorganized and small players have come under the tax net, which has hugely affected the price competitiveness of these players, thus benefiting the organized players.
India Electric Rickshaw Battery Market Competitive Landscape
Some of the major players operating in the Indian electric rickshaw battery market are Exide Industries Ltd., Amara Raja Batteries Ltd., Eastman Auto & power Ltd., Okaya Power Pvt. Ltd., Sparco Batteries Pvt. Ltd., Jay Ace Technologies Ltd., Grand Batteries Pvt. Ltd., and Gem Batteries Pvt. Ltd.
The report also includes state-wise analysis on the market. Some of the major states covered in the report are Madhya Pradesh, Uttar Pradesh, Delhi, West Bengal, Rajasthan, Bihar, Haryana, Chhattisgarh, Uttarakhand, Punjab, Jharkhand, Assam, and Tripura.