Friday, 17 May, 2024
By: Yash Gupte
The electric vehicle market in India has come a long way from a sale of 7,772 units in 2015 to more than one million in 2022. The highest year-on-year growth in the sale of EVs in the country was recorded in 2016 at 531.22 percent. Image Source: IANS
In the pandemic year 2020, only 1,23,092 electric vehicles were sold in the country. As compared to 2020, the number of electric vehicles sold in the first and the second quarters of CY2023 is much higher at 7,22,864.
According to the information provided by Minister of State for Heavy Industries, Krishan Pal Gurjar in a written reply to Rajya Sabha, a total of 8,738 Public Charging Stations (PCS) are operational in the country as on June 30, 2023. Various government schemes aimed at boosting the electric vehicle infrastructure in the country was highlighted by the minister in his written reply. Also, as per e-vahan portal of the Ministry of Road Transport and Highways, there has been an exponential rise in sale and registration of electric vehicles in India. In the year 2023 (till July 24, 2023), the total number of electric vehicles registered in India stands at 8,05,099.
According to the information earlier provided by the Minister, India had 6,586 Public Charging Stations (PCS) in the month of March 2023. And as of June 30, 2023, 8,738 PCS are operational in India, this means in just three months (April-June), the government has built 2,152 charging station across the country.
Also, the electric vehicle sales in India in the calendar year 2022 has brought cheers to the automobile industry in the country. The electric vehicle (EV) market has shown an impressive growth in the past year. The 10,15,196 EVs sold in CY2022 represent a significant 210 percent year-on-year increase over the 3,27,796 units sold in CY2021. The two and three-wheeler segments, both referred to as the "low-hanging fruits" of the EV industry, were responsible for the majority of the growth. It makes sense that they are the main drivers of EV sales because they are cheaper than the electric passenger cars or commercial vehicle segments.
In the pandemic year 2020, only 1,23,092 electric vehicles were sold in the country. As compared to 2020, the number of electric vehicles sold in the first and the second quarters of CY2023 is much higher at 7,22,864. This shows that the market has been very favourable for electric vehicles post pandemic. The number tells that many people are going for electric vehicles post pandemic.
According to the Vahan portal of Ministry of Road Transport and Highways, the electric four-wheeler segment clocked cumulative sales of 37,792 units in 2022. The company with the largest portfolio of EVs, Tata Motors, sold 30,284 units and holds an 80 percent market share. With 3,390 vehicles, MG Motor India holds a 9 percent market share.
With sale of 622,337 units, electric two-wheelers account for 62.23 percent of total EV sales in India in 2022 and 4 percent of India’s overall two-wheeler market which recorded cumulative sales of 1,53,07,255 units. The top 10 (Original Equipment Manufacturers) OEMs – Ola Electric, Okinawa Autotech, Hero Electric, Ampere Vehicles, Ather Energy, TVS Motor Co, Bajaj Auto, Pur Energy, Revolt Intellicorp and Being India Energy – account for 550,562 units or an overwhelming 89 percent of total sales. The electric two-wheeler market was dominated by Ola Electric in 2022 with a sale of 108,130 units followed by Okinawa Autotech with a sale of 101,366 units. In February 2022, around 57,424 electric vehicles were sold in the country, this number increased exponentially in February 2023 as the total sale of EVs was recorded at 1,06,107. This shows that the sale of electric vehicles in India has nearly doubled in one year. The chart below takes a look at the sales of electric vehicles in the country since 2015.
The electric vehicle market in India has come a long way from a sale of 7,772 units in 2015 to more than one million in 2022. The highest year-on-year growth in the sale of EVs in the country was recorded in 2016 at 531.22 percent. The EV sales jumped from 7,772 in 2015 to 49,065 in 2016. The rise in product availability in the market, the high cost of petrol, diesel, and compressed natural gas, as well as state subsidies and incentives provided under FAME II scheme, are all factors that contributed to the domestic EV industry's sales growth in 2022. Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME II), is a scheme launched by the Government of India to give a boost to development of Electric Vehicles. The Central Government has allocated a budget of Rs 10,000 crore for the second phase of this scheme. The scheme was launched to achieve the goals of National Electric Mobility Mission Plan (NEMMP). Phase I lasted from 2015 to 2019 and Phase II of FAME was launched in 2019.
Apart from the above mentioned schemes, The Government on September 15, 2021 approved the PLI Scheme for Automotive Sector with a budgetary outlay of Rs. 25,938 crore to support domestic manufacturing of vehicles. Electric vehicles are covered under this PLI scheme. Also, the Government on May 12, 2021 approved a Production Linked Incentive (PLI) Scheme for manufacturing of Advance Chemistry Cell (ACC) in the country. The total outlay of the scheme is Rs. 18,100 Crore for a period of 5 years. The scheme envisages to establish a competitive ACC battery manufacturing set up in the country (50 GWh).
Ankit Kedia, Founder & Lead Investor, Capital A said, "Lithium-ion batteries are by far the most efficient, safer, and lightweight battery options for the electric vehicles. This is where the discovery of Lithium reserves in different parts of India augurs very well for Indian EV ecosystem. It is true that the mere discovery of the Lithium reserves isn’t automatically going to change everything as we will need to build processing infrastructure and expertise. This is an area where countries like China and the US are far ahead of us in terms of sophistication and maturing of markets."
Currently, Australia produces 47 percent of the world's lithium, followed by Chile with 30 percent of the production and China with 15 percent. However, 58 percent of the processing of the mineral happens in China, 29 percent in Chile, and 10 percent in Argentina. Though India has discovered large reserves of the strategic mineral but is extremely important for the country to develop technologies and set-ups through which it can manufacture lithium batteries crucial for electric vehicles.
In the Financial Year 2022-23, 11,71,944 units of electric vehicles were sold registering a year-on-year growth of 155 percent as compared to FY2021-22 which recorded a sale of 4,58,746 units of electric vehicles.
Source: Ministry of Road Transport and Highways (E-Vahan Portal)
Two-wheelers, the most affordable EV sub-segment, accounted for 61.5 percent of all EV sales in India with 720,733 units, an increase of 185 percent year over year (FY2021-22: 252,539 units). A total of 399,540 electric three-wheelers, including both passenger- and cargo-transporting models, were sold in FY2022-23, an increase of 47 percent Y-o-Y (FY2021-22: 188,447 units). These vehicles made up 34 percent of all EV sales.
The fact that sales in March 2023 reached a new high of 131,175 units, surpassing the previous best of 121,389 units in November 2022, indicates the strength of the EV brigade. Beginning in the joyous month of October 2022, the move to six-figure revenues every month persisted all the way through March 2023.
In case of highest registration of electric vehicles, Uttar Pradesh has topped the chart as till date, 5,56,629 electric vehicles have been registered in the state. Uttar Pradesh is followed by Maharashtra with 2,96,885 electric vehicles, Karnataka (2,39,948), Delhi (2,29,305) and Rajasthan (1,75,595).
Though electric vehicle sales in India have crossed a mark of one million in 2022, there are few concerns which would haunt the future of EV sales in the country. According to Manu Sharma, spokesperson of the Society of Manufacturers of Electric Vehicles (SMEV), “A long-term policy with greater focus on sourcing, a strong supply chain for crucial raw materials such as rare earth metals, and country-level arrangements are the need of the hour to avoid overdependence on midstream suppliers such as China. If these aren't in place, the EV industry's growth plans could be impacted.” He further added that if the supply chain is disrupted due to Covid, there will be a shortage of raw material and semiconductors. But the numbers clearly indicate that the electric vehicles will be dominating the automobile market in near future.
