Electric Cars in India
Rising incomes and urbanization, a passenger vehicle sales boom and the drive toward cleaner air could be setting the stage for the transformation of mobility in India and the auto industry worldwide. Air pollution, rising incomes and the largest urbanization wave of the 21st century could drive the next era of mobility in India, one of the world’s most populated nations. This pivot to Autos 2.0 electric vehicles, shared mobility and autonomous driving could potentially help drive half of the incremental global car demand over 2017-30 and position India as a key player in the evolution of auto manufacturing. The shift comes as India faces the largest urbanization wave of the 21st century. By 2030, seven of India’s most populated cities will house more than 10 million people each. Pollution also continues to be a challenge in the country’s major urban areas. With rising income driving demand for more autos, vehicle pollution will only increase unless the country shifts away from the traditional internal combustion engine (ICE) vehicle.
Analysts say, “To confront the ongoing challenges of pollution and urbanization, India will need to transition to electric vehicles (EVs), shared mobility and autonomous driving.” The report suggests 30% of new vehicle sales in India could be electric-powered by 2030 versus zero in 2017 and that shared-ownership model vehicles could account for 35% of the miles driven throughout the country. The result could mean increasing job growth in India, a lower trade deficit and a cleaner environment.
While a cleaner environment and the changing urban landscape are creating the need for better transportation, three other factors may further enable the transformation.
First, an intensifying public debate on pollution and urban congestion could spur more forceful government action. Second, investment in the US$1 trillion global opportunity for Autos 2.0 is reducing the cost of electric vehicle batteries and advanced driver-assistance systems in automated vehicles. Finally, the small passenger vehicle (PV) base in India (3% of the total global car population) means that new buyers will be driving most of the projected growth over the next 20 years. These new buyers could leapfrog ICE cars and jump directly into 21st century technologies. Since India could represent half of incremental global car demand over the next two decades, global OEMs that are investing heavily in Autos 2.0 will chase this growth.