New Delhi: The sale of electric cars (e4w) surged 268% to 18,142 units in H1FY23 compared to 4,932 units, and electric two-wheelers (e2w) grew 404% to 2,77,910 units from 55,147 units in the same period last year, respectively. These exponential growth figures are owing to a lower base witnessed last year the EV adoption rate still remains quite low, according to a study by the research analyst Windmill Capital, a wholly owned subsidiary of smallcase Technologies Pvt. Ltd.
Monthly unit sales of e2w crossed the 50,000 unit mark for the first time in August 2022, improving further to 68,324 units in October.
The Indian e2w space is a lot more competitive with the top 3 players commanding over 50% market share. According to a report, Okinawa Autotech is the leader with an 18.8% market share. The Gurugram-based company has seven EV brands and a 300+ strong dealer network. Ola Electric, which sells EVs under the S1 brand holds the second spot with cumulative sales of 44,801 units and a market share of 16.1%. There are speculations of the company launching e4ws as well. Hero Electric holds the third spot, selling 43,388 units and a market share of 15.6%. Greaves Cotton-owned Ampere Vehicles is in 4th place with a 13.6% market share. Hero Motocorp-backed Ather Energy, TVS Motors, and Bajaj Auto are the other major players in the e2w market in India.
| Electric 2W OEMs | April’22 | May’22 | June ’22 | Jul ’22 | Aug’22 | Sep’22 | Total |
| Total EVs retailed | 49,183 | 39,520 | 42,303 | 44,614 | 50,506 | 51,784 | 2,77,910 |
Source: Autocarpro
EV sales up 268% in H1FY23
Tata Motors is the clear leader in the e4w space. It sold 15,518 units during the first half of FY23, commanding a market share of nearly 86%. The company offers Tiago EV, Tigor EV, and Nexon EV in the e4w space. While EV sales growth numbers are very high due to the low base, their adoption rate still remains quite low. Major auto manufacturers are also betting big on the EV theme. Tata Motors, the market leader in the e4w space, plans to introduce 10 new EV models by 2025. Mahindra & Mahindra has announced that it will launch 5 new EVs between the years 2024-26 and will spend $1 billion on them. Bajaj Auto has expanded its e2w network to 40+ cities compared to just 12 cities in March 2022. It has also commissioned an EV manufacturing plant in Pune with a 5 lakh unit capacity.
| Electric car makers | April’22 | May’22 | June’22 | July’22 | Aug’22 | Sep’22 | Total |
| Total | 2161 | 2855 | 3111 | 3329 | 3267 | 3419 | 18142 |
Source: Autocarpro
Abhishek Jadon, smallcase manager, and VP, Windmill Capital, said, “The Central Government and many State Governments have been providing incentives to boost the development of the electric mobility ecosystem. The former has increased budgetary support for the FAME scheme. It has also exempted EVs from registration charges and offered tax deductions on interest paid on loans availed to purchase EVs. State Governments have been offering incentives on the supply side. Exemption of stamp duty on the purchase of land for EV production, reimbursement of SGST for EV manufacturers, tax exemptions on electric tariff, land subsidy, etc. are some of the available supply-side incentives.“
High cost stalls growth
The government’s support, active participation from the industry and high fuel prices are all positives for the EV industry. The final issue for EV adoption is the Total Cost of Ownership (TCO) barrier. TCO is the sum of all costs involved in the purchase, operation, and maintenance of a given asset during its lifetime.
Upfront costs of EVs are usually higher than the Internal Combustion Engine (ICE) vehicles and are a major barrier to EV adoption in the price-sensitive Indian market. However, one also needs to consider the subsidies related to EV purchase and their lower operating cost. According to research institute WRI – India, in the two-wheeler (2W) and three-wheeler (3W) segments, EVs are more economical than their ICE counterparts. e4w are commercially viable when used for commercial purposes.
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