India Electric Rickshaw Market To Generate Revenue Worth $1,394.2 Million by 2025

  • Published: February 2021

Electric rickshaws or e-rickshaws gained prominence in India in 2010, when these vehicles started operating in the suburban and urban areas of Delhi and various towns of Uttar Pradesh, Bihar, and West Bengal. Electric rickshaws are a zero-tailpipe-emission transport option for first/last-mile connectivity in cities. With the rapid growth in demand for these rickshaws in India, there has been a relative increase in investments by manufacturers for the design and development of more efficient and affordable electric rickshaws.

Moreover, renowned automotive players, such as Mahindra & Mahindra Ltd. and Hero Electric Vehicles Pvt. Ltd., have made inroads in the Indian electric rickshaw market in recent years. Thus, on account of the above-stated factors, the electric rickshaw market in India is projected to reach $1,394.2 million by 2025, advancing with a CAGR of 33.3% during the forecast period (2020–2025).

The COVID-19 pandemic has negatively impacted the Indian electric rickshaw market. Before the disease outbreak in India, last-mile connectivity in urban mobility was viewed as a sunrise sector, which was gaining ample investor and entrepreneurial interest. However, since the outbreak, the public-transit ridership has fallen up to 90% in major cities of India. The operators are burdened with uncertainty and the potential need to implement and maintain strict hygiene protocols—such as compulsory face masks and health checks for passengers, and the restricted number of riders to comply with the social distancing and space requirements. Moreover, the preventive measures taken by the Government of India, such as lockdown and even curfew in hotspot areas have killed the demand for electric rikshaws.

Passenger Carrier Category Dominated the Market in 2019

The Indian electric rickshaw market has been categorized into passenger carrier and load carrier on the basis of vehicle type. Of the two, the passenger carrier category held the larger market share during the historical period. The primary factor for the market growth in this category is the presence of a large passenger base in India.

The electric rickshaw market in India has also been categorized into <101 Ah and >101 Ah, based on battery capacity. Of the two, the <101 Ah category accounted for nearly 70% sales volume in 2019 and is expected to lead the market till 2025. The cost of electric rickshaws of battery capacity <101 Ah is lower than that of electric rickshaws of battery capacity >101 Ah. The demand for low-cost electric rickshaws is higher in the country, which is the major factor boosting the market in this category. However, in terms of growth, the >101 Ah category is expected to register higher CAGR during the forecast period.

Geographically, Uttar Pradesh is expected to hold the largest share in the electric rickshaw industry in India in 2025. The increasing demand for these rickshaws in the prominent cities of Uttar Pradesh, such as Lucknow, Varanasi, Noida, and Kanpur, is expected to drive the market growth here during the forecast period.

Growing Need for Public Transportation for First- and Last-Mile Connectivity

With the rapid urbanization in India, the demand for public transportation for first- and last-mile connectivity is projected to increase in the coming years. According to a World Bank report, urbanites account for up to 33% of India’s total population. With increasing urbanization, more vehicles will be required for public transportation, especially for meeting first- and last-mile-connectivity needs in the country.

According to industry experts, nearly 70% of public transport users in India rely on cabs, autos, and non-motorized transport (NMT) for first- and last-mile connectivity. These commuters generally either walk or use these modes of transport to reach the nearest public bus stand or metro station and mostly prefer the same to reach the final destination. Since electric rickshaws provide commuters with an environmentally friendly first- and last-mile connectivity solution at an affordable rate, they are gaining traction among the daily commuters in the country. Besides, with the government pushing for vehicles that run on clean fuels, electric rickshaws easily fit the bill, thus providing ample growth opportunities to the players in the Indian electric rickshaw market.

Some of the major players operating in the Indian electric rickshaw market are Terra Motors Corporation, Hero Electric Vehicles Pvt. Ltd., Kinetic Green Energy & Power Solutions Ltd., Lohia Auto Industries, ATUL Auto Ltd., and Saera Electric Auto Pvt. Ltd.