Electric Vehicles hold hope despite slow adoption

By Editor


Image courtesy: http://www.motoroids.com

Electric vehicles will play a vital role in the outcome of the ongoing measures to curb carbon emissions globally.

Although the segment is currently small in India, and yet to gather momentum — recent government incentives notwithstanding — the industry is hopeful of better performance in the future.

In an interview given to Malyaban Ghosh and Pranav Nambiar of The Financial Express, V S Parthasarathy, the chief financial officer of Mahindra and Mahindra, said companies will have to make calculated guesses on what will be feasible in the future.

“Reva, which is an electric vehicle, fits into the future perfectly. Ten years from now, we will be surprised at the pace of change. I see evolution rather than revolution, but it will take time and government support (for the segment to grow),” he said.

The government of India had in November 2010 announced a subsidy of roughly $15 million (in today’s exchange rate) for electric vehicles.

It translated to benefits of up to 20 percent on ex-factory price to buyers.

In figures that meant maximum reduction of about $1,570 on electric cars and proportionate discounts on vehicles of other segments that had at least 30 percent of their components manufactured in India. That scheme ended March 31, 2012.

Last April the government announced a new plan that increased subsidy on electric cars leading to price cuts to maximum of $2359 on cars with proportionate reduction in other segments.

ALSO READ: Demand for EVs on the rise

The new program named Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME) offers subsidies on retrofit projects, too.

India is targeting the introduction of seven million electric vehicles in the country by 2020.

“If electric vehicles have been successful in Europe, it’s because of government support. We have to make the price palatable for the customer and the infrastructure has to be good enough. There is both need and want,” Parthasarathy said.

Mahindra had reduced the price of its electric vehicle Reva following the announcement of the new subsidy program.

Ajith Kumar S

[email protected]

Latest News