The automobile industry in India is one of the largest in the world. It accounts for 7.1% of the nation’s GDP. Also, owing to the growing middle class population, the two wheeler segment has 81% market share in the Indian Automobile market. Electric cars are steadily gaining momentum and in a few years it will take over. Also, the Government of India plans to make all the cars electric by 2030.
The Future of Electric Cars in India and how it affects the Automobile Components Manufacturers
Automobile components manufacturers and few leading companies such as Maruti Suzuki India Ltd, Ford India Pvt. Ltd, Mahindra & Mahindra Ltd, Mahindra Reva Tata Motors Ltd and Electric Vehicles Pvt. Ltd have created a consortium that will help develop a supplier base for critical hybrid and electric vehicle components in India.
According to Arvind Mathew, Managing Director of Mahindra Reva,“The idea is to build a supplier base by providing component makers economy of scale. The move will bring down costs and promote the usage of such vehicles,”
But the real question is whether India is really equipped to achieve the goal? Are the auto components manufacturers in India prepared to produce the parts in such a short duration? The biggest issue is the battery which makes up for 50% of the cost of an electric vehicle. However, as per Bloomberg data, the cost of Lithium ion batteries has dropped 73% in the last six years. Again, India does not have any Lithium deposits while countries like China, Argentina, Chile and Australia have the largest Lithium reserves. This poses an obstacle to setting up a feasible battery manufacturing plant in India and it also implies that companies will have to look for other options to power electric vehicles. However, thanks to the ever evolving technology, plenty of other options are available. For instance, aluminium battery has been created by Stanford University. These can charge in short period of time thereby slashing the charging time drastically.
The global market for electric vehicles is also witnessing intensified competition, with several top notch companies spreading the benefits of such vehicles. Few Chinese cities such as Beijing and Shanghai have already announced to transform their taxis into electric vehicles.
In the next 15 years or so India’s passenger car ownership is expected to grow by leap and bounds.This will also change the scenario of how these electric vehicles will be powered. It is up to the auto components manufacturers in India to seize the moment and come up with exclusive ideas to make EV’s a dream come true.