The total EV (electric vehicle) registrations (including all segments) have surpassed one million units in this calendar year and the number is likely to touch 1.4 million or more for 2023, given the current trend and planned capacity ramp-up by various EV manufacturers.

The adoption of EVs in India has seen significant momentum in the past couple of years, supported by proactive measures taken by the government of India and various State governments in both demand and supply aspects. People are increasingly aware of the environmental as well as cost benefits of EVs, leading to a surge in demand in recent months. With stringent norms for batteries, safety-related issues are also being addressed.

And, EV manufacturers are actively expanding their EV product portfolios and an increasing number of players are now offering longer-range options to meet consumer preferences.

In 2022, total EV registrations in the country stood at 10,24,776 units. For this calendar year, the total EV registrations stood at 10,06,929 units (as of September 12), according to Vahan Dashboard.

Of the total registrations this calendar year, electric two-wheelers accounted for 57 per cent at 5,74,134 units, followed by electric three-wheelers at 37 per cent (3,74,144 units). Electric passenger vehicles, with more than 55,000 registrations, accounted for 5.5 per cent.

Rebound in sales

While a reduction in FAME II subsidy caused a slowdown in electric two-wheelers, the market has seen a rebound in sales of battery-powered two-wheelers in recent months. E2W OEMs are looking forward to improving the volumes in the upcoming festive season. In several locations, electric two-wheeler penetration has touched double digits.

While the E2W market leader Ola Electric has sold close to 1.7 lakh electric scooters so far in this calendar year, TVS Motor has sold more than 1.08 lakh electric scooters. Ather Energy’s E2W registrations were close to 76,000 units. “With the refreshed product portfolio and the festive season kicking off, we are confident of capturing a larger market share in the coming months,” says Ravneet Singh Phokela, Chief Business Officer, Ather Energy.

The gradual improvement in charging infrastructure and investments in developing a local vendor ecosystem have further contributed to the rapid adoption of EVs. Auto-parts makers have been witnessing a significant surge in their EV order book on the back of OEMs’ proposed new model launch and capacity expansion plans.

Rating agency ICRA says that about ₹70,000-crore investments have already been announced by the OEM segment, while components makers have planned ₹30,000 crore of investments.

Chinese EV battery cells cheaper

Meanwhile, in a positive development for the industry, the EV battery cell market has reported a significant decline in prices recently. The average selling price (ASP) of EV cells in China dipped below CNY (Chinese Yuan) 0.6 per watt-hour in August. This drop in prices was seen in various types of EV batteries, including square ternary cells, LFP cells, and pouch ternary power cells, all witnessing a 10 per cent reduction in their respective prices, according to TrendForce, a leading market research firm.

“With a glut in China’s storage cell production capacity, a price war appears unavoidable, with a continued gradual price decline expected for the rest of the year,” it added.

This development may augur well for the Indian EV industry to take advantage of this situation. Overall, all these factors may drive higher EV penetration in the coming months, particularly in electric two-wheeler, three-wheeler, and bus segments.

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