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India’s ambitions in the field of electromobility have suffered a major setback due to the Covid-19 pandemic. Vehicle manufacturers admit that electrification will take a back seat for the time being in view of the severely affected core business. However, they remain firm on the long-term goal of promoting cleaner alternatives to fossil fuel vehicles.

Sales of all types of people carriers, including light and heavy buses, tricycles, e-rickshaws, and taxis, have declined since the 2020 pandemic as most turned to private transportation.

This has impacted India’s efforts to electrify public mobility, a segment the government has targeted as an efficient way to reduce the carbon footprint of larger numbers of passengers.

Source: Company of Indian Automobile Manufacturers

“The lockdown and restrictions caused by Covid-19 have had a major impact on the entire commercial passenger segment,” said Rohit Srivastava, vice president for the bus segment at manufacturer Tata Motors. “The pace of electrification, especially with e-buses, has also slowed down.”

However, Srivastava hopes that the continuation of robust funding programs such as Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) will help to spark consumer interest in electric mobility in the long term.

The FAME program

In 2015, the Indian government introduced an incentive package called Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME).

It was updated in January 2019 with a much larger Indian rupee ($ 1.4 billion) budget to support the sale and manufacture of electric vehicles and components for three more years.

The program includes incentives to switch to electric cars, buses and motorcycles as well as the promotion of the expansion of a nationwide charging network.

Only vehicles that have at least 40 percent of their components made in India are eligible, a restriction aimed at encouraging domestic production.

The pandemic may require an extension of the current end date of 2022 for the program.

The need for a long-term vision

Anumita Roychowdhury, Executive Director of Research and Advocacy at the Think-Tank Center for Science and Environment (CSE), says India needs a long-term and consistent policy roadmap to get electrification back on the mobility agenda.

“But the reality is, we don’t even know what will happen after that [the second iteration of the] FAME [scheme]She said. “While we understand that Covid-19 derailed the economy, we could have been much more strategic in linking economic and green recovery,” added Roychowdhury.

She welcomed the central government’s newly announced incentive system to reward the production of batteries, known as Production Linked Incentives (PLI). But the center and states need to come together with coherent policies for all initiatives to be effective, she added.

Despite all the disruptions, Mahindra & Mahindra, one of the early entrants into the electric community transport segment, remains optimistic that rapid electrification is possible, especially for vehicles that travel short distances like rickshaws.

“We estimate that by 2025 approximately 40 percent of the total tricycles sold in the country will be electric,” said Mahesh Babu, CEO of Mahindra Electric.

In contrast to industrialized countries, India requires complex transport solutions with a number of different vehicles for each stage of a trip. Last mile mobility in India presents a great opportunity for electric vehicle (EV) penetration and is about to undergo massive transformation, Babu said. “Our goal is to introduce new, innovative and bespoke EV solutions in both the private and commercial sectors that will enliven India’s last mile mobility and delivery needs.”

Mahindra has more than 3,000 electric four-wheeled vehicles and more than 20,000 electric three-wheeled vehicles such as rickshaws used in community and corporate markets. Since these vehicles cost as much as their carbon-intensive counterparts but are cheaper to maintain, Babu believes electric vehicles are well suited to providing last mile transportation and delivery services.

However, the pandemic has not spared even the slow electric rickshaws that have been at the forefront of India’s electric vehicle revolution.

Before the pandemic, nearly 8,000 to 11,000 e-rickshaws were sold per month, according to a 2018 study by consulting firms Kearney and Bloomberg. It was expected that this number would grow steadily, said Rahul Mishra, partner at management consultancy Kearney.

“Covid has not only had a major impact on the e-rickshaw market and shared mobility, it has also pushed the e-mobility agenda out of the country,” said Mishra. As the e-rickshaw market organized and manufacturers entered the market with better products, the pandemic forced them to fundamentally rethink their strategy, he said.

Charge in advance

However, Eric Vas, president of the Urbanite branded business at motorcycle and auto rickshaw maker Bajaj Auto, believes tricycles will remain a cost-effective solution for the average city commuter. “We may not have brought anything commercially to market yet, but we have put enough vehicles on the market that are being tested.

There are several challenges at this point, ranging from the initial cost to the charging infrastructure, ”he said. The lack of charging infrastructure is one of the main reasons why electromobility is not yet so successful in India.

Even battery swap solutions, in which the user only rents the charged battery and swaps it at dedicated swap points, are not efficient, according to Vas, given the high battery costs.

If a battery is the most expensive part of a vehicle, investors would be more likely to reduce the number of batteries rather than the other way around, Vas said, pointing out that with battery swap systems, the number of batteries available at all times must exceed the number of vehicles they end up using .

According to a recent report by Emkay Global titled Decoding Electric Vehicle Disruption, battery manufacturing in India is expected to increase as local manufacturing is required to keep electric vehicle costs competitive. Due to economies of scale and technological advances, battery costs are expected to decrease, which would make battery swaps sustainable for smaller vehicles, the report said.

Despite the setbacks caused by the pandemic, public transport is indispensable, says Roychowdhury from the CSE. A clear, long-term electrification roadmap for the next decade will determine whether India’s roads become less carbon intensive.

But India can only move towards clean mobility if it learns from its political failures and successes, stimulates production, and invests in the lighter modes of transport that are most popular with consumers.

Eco-Business published this story with permission from The Third Pole.

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