Companies

Suzuki chief discusses with Modi feasibility of making e-vehicles and the hurdles ahead

S Ronendra Singh New Delhi | Updated on January 09, 2018

Osamu Suzuki

Govt support required for ‘affordability’ factor, says Maruti Suzuki India head



The Chairman of Suzuki Motor Corporation (Japan), Osamu Suzuki, called on Prime Minister Narendra Modi to share the company’s future plans in India and to discuss the feasibility of electric vehicles in the country.

According to sources in the know, the company shared its plans along with Toyota Motor Corporation, on introducing electric vehicles (EVs) in the Indian market and also the hurdles for EV manufacturers in the country.

“It was just a courtesy meet. We just wanted to share what we are doing with Toyota and decided to meet the Prime Minister, who was very happy to note what we are doing (on electric cars). Of course, we also shared some general issues (related to electric vehicles),” Kenichi Ayukawa, Managing Director and Chief Executive Officer, Maruti Suzuki India (MSIL), told BusinessLine on the sidelines of an event held here recently.

Ayukawa and MSIL’s Chairman RC Bhargava were also part of the meeting with Modi. Declining to comment further, Ayukawa said the meeting was good ‘for the time being’.

Toyota Motor Corporation and Suzuki Motor Corporation in November had concluded a memorandum of understanding (MoU) on moving forward in considering a cooperative structure for introducing EVs in the Indian market by 2020.

Affordable tag

MSIL said that the EV that any company makes should be affordable and meet customer requirements. And, to make them affordable, government incentives would be needed.

“That is why a lot of things have to be done. Everybody knows what kind of infrastructure will be required and what will happen to people who don’t have a charging point at their homes,” Bhargava said in a freewheeling chat here.

He said that affordability of electric cars had to be looked at, especially how to make small cars electrified as 75 per cent of such cars are small cars.

“I think this is one of the challenges that we will have to face because making an affordable large car is different from making an affordable small car. We need to keep that in mind. So what kind of government support, policy is required needs to be worked out,” Bhargava said.

Consumer survey

The company, which plans to launch its first electric car in India by 2020, said it will conduct a study to get consumer insights to prepare for the journey, he said. “So far, nobody has come out with any such survey. We want to find out what consumers think. Way back, Maruti was the only PSU to do such survey and Maruti 800 (first car by the company in India) was based on a consumer survey,” he said, adding that similarly, based on reliable data from consumers, the company would see what can be done for Indian consumers.

The survey should start within the next two to three weeks and by February-end, the company will have a strong basis, he said, adding that as EVs are a new development for the Indian auto industry, it will be difficult to say how much government support will be needed. The company has also done an assessment, assuming an annual growth rate of 8 per cent between now and 2030, that 71 million cars will be sold, of which 14.4 million will be electric and 56.6 million will be internal combustion vehicles, Bhargava said.

Accepting that the company does not have any technology around EVs right now, he said the joint venture between Suzuki and Toyota was dealing with the future products. But, he ensured that the EVs would be made in India, and also sold and serviced here.

“The joint venture will start with the framework. Where would manufacture of the cars take place (which plant) are not decided yet. A lot of details have to be worked out right now,” Ayukawa said. He said the only thing the company was aware of was that, Suzuki (Japan) was doing cell manufacturing in its plant in Gujarat.

Battery cells

Meanwhile, Bhargava said to make four million electric cars a year (with the current level of the industry), there needs a lot of battery cells and as of now that does not look feasible in India.

And, if the companies have to import those batteries or battery cells, the entire idea of ‘Make in India’ will go for a toss.

“It has to be done in India and the government has to look at it whether in terms of incentives or subsidies. Oil in any case is depleting and one has to look at the alternatives,” Bhargava added.

Published on December 22, 2017

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