The Road Transport To Be Taken: Electric Vehicles

Originally published on econfinity.in

An advert released in April 2021 by Volvo with eco-spokesperson Bjorn showcased an Ultimate Safety Test. The company addresses that the ultimate safety test for their cars was not crash tests or impact tests but a sustainability test. The future is cars that master the ultimate safety test. This a reminder that only safety on the road is not imperative for vehicles but for the sustainability of climate change; hence the future is electric. 

Many believe that electric vehicles (EVs) are inevitable in the coming years, they are not only riding the wave of the future but will be vital in saving lives.  In a few years to come, we will be closer to an EV than ever before. There is a constant demand for both innovation and the creation of infrastructure to manufacture these wonders due to a rise in demand. Electric vehicles zipping past would be a common sight not too far in the future. By the year 2025, 30% of car sales would be attributed to electric vehicles and hybrid electric vehicles. By the year 2030, the number of electric cars is expected to jump from 3 million to 125 million. In other words, one car for every citizen of Japan- the 11th most populated country in the world. The market for EVs is expected to reach almost USD 1.5 trillion by 2025.  This can be extremely lucrative to the automobile industry and enable a stage for innovations that cater to sustainable transportation. 

The EV industry has witnessed its fair share of turbulence. In the late 19th century, two countries - France and the UK were heralded as the pioneers of EVs. Nonetheless, both the discovery of abundant oil and larger roadways caused a roadblock in the upward trajectory of EVs. Today, while the lion’s share of car sales can be attributed to diesel and petrol cars, 2021 could very well be a start for a more permanent future for EVs. Norway, for instance, became the first nation where electric car sales overtook those of petrol, diesel or hybrid cars. In the year 2020, they set a world record with EVs representing 54% of the total new car sales, country plans by 2025 to ban sales of all internal combustion vehicles. 

The future is electric and the numbers speak for themselves. Before the onset of the COVID-19 pandemic, alongside other industries, EVs were moving into the spotlight steadily.  In the year 2019, electric car sales boosted to 2.1 million, higher than 2018 sales which was a phenomenal record year. In the year 2020, the sale of electric cars accelerated by 43%, rising to more than 3 million. Tesla topped the charts, with Volkswagen following in at the second position. Electric car sales almost more than doubled in Europe. 

Even though the pandemic caused car sales to turn downward, electric car sales grew. Electric car sales increased despite the contraction of the automobile industry by 16%, Europe took over China as the largest EV market, although China still houses the most significant number of electric cars with 4.5 million cars on their roads.

The above chart depicts that the past 10 years have depicted growth in electric car sales which serves as a prescient for a cleaner and sustainable automobile future. A reason for this push could be attributed to the deadlines set by many governments to end fossil-fuel-powered car sales. Another key reason for this could be, electric cars have better technology - there is no noise, no pollution, better costs and even better acceleration. Despite having favourable features, the main problem with electric cars is the higher price point, which is being brought down. 

The Road To India:

A little while back, the presence and viability of electric vehicles were doubtful - given a lack of infrastructure and policies. However, this sector has seen a push,  Nitin Gadkari the union minister for road and transport in November of 2020 said that to promote EVs, there would be at least one charging kiosk set up across 69,000 petrol pumps in the country. The government has launched plans such as the National Electric Mobility Mission Plan (NEMMP),  Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles (FAME) Scheme alongside tax cuts and loans. Even state governments have joined the wagon to incentivise EV sales. Cities such as Delhi and Kolkata have promoted e-rickshaws which ensure the lower operation and economical costs, Delhi has almost one lakh rickshaws plying on its roads. They even launched a Switch Delhi campaign that has promoted the adoption of EVs, this has resulted in success as companies have announced that would be launching new models in the capital. The transport minister of Delhi had also stated that post the campaign launch, two-wheeler electric vehicle registrations have been on the rise. In addition, they have laid a vision of installing a charging unit every 3 kilometres and aim to set up 500 charging points by December 2021.

EVs are still not a common sight in India with 30 crores of EVs plying the country’s roads, of which most are two-wheelers and three-wheeler rickshaws.  As the country has now been moving towards a smog-less environment making maximisation of EVs imperative. 

Nonetheless, India is burdened with technological and logistical problems, as depicted in the above infographic. Issues such as charging infrastructures, safety, and time constraints currently, the city of Delhi, with a population of 31 million people, merely has 72 charging stations. The government aims to ensure that 15% of vehicles are electric by the year 2030.  

The market has been at a 20% annual growth rate, mostly dominated by 5 major companies namely, Mahindra & Mahindra, Tata, MG Motor India, JBM Auto Ltd. and Olectra Green Tech Ltd. Even local auto companies have joined the bandwagon by making EVs and their parts, albeit slowly due to insufficient demand. India in 2020, increased tariffs on EV imports, they have even propounded policies to boost domestic production thereby reducing prices and improving quality. 

The country aims to increase the use of EVs following the global trend, but the government needs to improve the environment for EVs. There will also need to be a policy that monitors the quality and technology of the EVs, and a regulatory framework that ensures safety parameters. There is a need for a sustainable market that confirms an ecosystem exists with the proper infrastructure, such as battery systems, and charging points, alongside the presence of financing and mortgage mechanisms.