Electric Vehicle Adoption in India: Challenges and Opportunities
India’s journey towards electric vehicle (EV) adoption is riddled with challenges, particularly the lack of charging infrastructure. Rajiv Khattar, a 60-year-old business strategist, experienced this firsthand while driving from Amritsar to Delhi. During his 450km journey, he found it difficult to locate operational charging stations, especially in the peak of summer when his battery was depleting faster than usual. The first charging station he found was not operational, and the next one was 35km away. This incident highlights the need for meticulous planning by EV owners, particularly on highways where charging facilities are scarce.
A recent survey underscores the growing discontent among EV owners in India. More than half of the respondents expressed a desire to switch back to diesel and petrol cars. Charging anxiety, rather than range anxiety, has become the primary concern, affecting 88% of those surveyed. Despite the presence of 25,200 public charging stations, the availability and functionality of these stations remain inconsistent. India aims to increase this number to 46,397 by 2030, but this still falls short compared to the global average of one charging station per 6-20 electric vehicles. This inadequacy poses a significant hurdle to India’s ambitious goal of achieving net-zero carbon emissions by 2070.
The government needs to take decisive action to address these issues. Amit Bhatt, managing director of a policy think tank, emphasized the necessity for mandated installation of charging stations and clear guidelines on the process. Rajiv Khattar, who has installed a charging station at his residence, pointed out that many public charging stations have higher capacity chargers than what most EVs can handle. This mismatch further complicates the situation. The utilization rate of public charging stations in major cities is alarmingly low, at only 4-5%. On average, each charging port is used for just an hour, with a base rate of 20%. To improve this, the government must allocate land to private players for charging stations and ensure facilities for power enhancement to provide uninterrupted charging.
New guidelines recommend a denser network of charging stations, with one station per 1km x 1km grid in urban areas and every 20km on highways. Interoperability among charging stations is also recommended to increase utilization and convenience for EV users. However, the recent discontinuation of a central government subsidy led to a more than 14% drop in EV sales in June. Although a new subsidy plan has been introduced, many EV owners remain dissatisfied with the resale value and after-sales service of their vehicles. Experts argue that India must electrify its entire motor vehicle fleet, including heavy-duty trucks, between 2045-2050 to meet its net-zero carbon emissions target by 2070.
This sentiment is not unique to India. A global survey by McKinsey found that nearly 30% of EV owners are likely to switch back to gas-powered cars. This trend is even more pronounced in the US, where 46% of EV owners expressed a desire to return to internal combustion engine (ICE) vehicles. Despite recent sales gains, EV adoption in the US has slowed. Companies like GM and Ford have reported increases in EV sales, but these still constitute a small percentage of their total sales. Tesla, while remaining the leader in EV sales, has seen a decline and has had to reduce prices. A Gallup poll revealed a decrease in the number of non-EV owners in the US considering purchasing an EV, while the percentage of American adults who do not intend to buy an EV has increased.
One of the primary reasons for this reluctance is the lack of adequate public charging infrastructure. Disparities in the distribution of EV chargers, with urban areas having more access than suburban and rural regions, exacerbate the issue. Charging problems, battery range, and negative experiences with EVs are major factors driving EV owners to switch back to gas-powered cars. Automakers have responded by offering discounts and incentives, but the resale value of used EVs continues to decline. There are notable differences in satisfaction levels between early adopters and those who are more affluent and have multiple car options. Luxury EV buyers are more likely to purchase another EV, while those who rely on their EV as their primary mode of transportation are more inclined to switch back to gas-powered cars.
In India, a survey conducted by Park+ involving 500 e-car owners in Delhi NCR, Mumbai, and Bengaluru revealed that more than half are considering returning to ICE vehicles. Charging anxiety was the top concern, affecting 88% of respondents. This issue has now surpassed range anxiety as a significant problem. Despite the presence of 20,000 EV charging stations in India, many drivers struggle to find safe and functional stations. Maintenance costs are another major issue, with 73% of e-car owners expressing dissatisfaction. The lack of understanding of electric vehicles and the inability of local mechanics to solve problems add to this frustration. Additionally, the resale value of e-cars is a concern, with 33% of respondents reporting lower-than-expected quotes.
Unlike ICE vehicles, there are no widely used tests to determine the quality of an EV’s battery, affecting its resale value. E-car owners also reported lower levels of satisfaction compared to ICE car owners. According to the survey, 51% of 4w EV owners would not consider buying another EV and would switch back to ICE vehicles. The TATA Nexon EV emerged as the most preferred choice among e-car owners, followed by TATA Punch EV. TATA EVs were praised for their design, durability, and safety. BYD also gained attention, but its pricing and lack of test driving options were noted as obstacles. Amit Lakhotia, founder and CEO of Park+, commented on the survey and their commitment to enhancing the car ownership experience.
The study confirms that nearly 91,000 electric passenger vehicles were sold in India during the financial year 2023-24. However, the Indian EV market still faces challenges in terms of owner satisfaction and overall user experience. Building a robust and smart EV charging infrastructure and addressing challenges such as charging anxiety and resale value will be key in improving the overall EV ownership experience in India. Despite these hurdles, there is potential for improvement as stakeholders like Park+ aim to tackle these issues. The future of mobility in India is likely to be a combination of electrification and traditional combustion engines.
The electrification megatrend has the potential to transform not just transportation but other industries as well. However, doubts surrounding its adoption persist. A survey of 500 EV owners in Delhi-NCR, Bengaluru, and Mumbai showed that 51% would prefer to switch back to a traditional ICE vehicle. While the sample size may be small, the survey reveals key concerns among EV users. Top among these is charging anxiety, which could pose a hurdle in the widespread adoption of EVs. Despite this, the electrification megatrend can still progress with some help from traditional internal combustion engines. One way to address the concerns of EV owners is through speedy charging. Downloadable apps can also help with planning routes and finding charging stations.
Another possible solution is the use of hybrid vehicles, which combine both electric and traditional engines. Implementing charging infrastructure in cities and along highways can also help promote EV adoption. Manufacturers should focus on improving battery technology to increase range and reduce charging time. Government initiatives and incentives can also play a role in promoting EVs. Collaborations between automakers and energy companies can further drive the electrification megatrend. The impact of electrification goes beyond just transportation, with the potential to transform other industries as well. The article also highlights the potential for India to become a global leader in EV adoption. However, challenges such as cost and infrastructure need to be addressed.
The future of mobility is likely to be a combination of electrification and traditional combustion engines. More research and effort are needed to fully realize the potential of the electrification megatrend in the transportation sector. Building a robust charging infrastructure, addressing charging anxiety, and improving the resale value of EVs are crucial steps. Government policies, industry collaborations, and technological advancements will play a significant role in overcoming these challenges. As India strives to achieve its net-zero carbon emissions target by 2070, the successful adoption of electric vehicles will be a critical component. The journey towards electrification may be fraught with obstacles, but with concerted efforts from all stakeholders, the future of mobility in India looks promising.