The Indian passenger vehicle market is one of the world's top 10 markets. It had 2.52 million units in 2010-11 and is expected to grow at approximately 13 per cent over the next five years, making it one of the fastest growing markets for passenger cars worldwide. What is going to drive this spurt in passenger vehicles in India is a low the current low car penetration level of 13 passenger vehicles per 1,000 people.

According to a recent study by Frost and Sullivan on the future of mobility in India, and the implications for automotive companies, while the per capita population of cars in developed economies is expected to stabilise, it will continue to grow in emerging economies like India.

All this will lead to a number of challenges including congestion in cities, deterioration in the quality of air and also increasing travel time. Globally, transportation systems account for approximately 23 per cent of the total CO{-2} emissions.

This does not include the energy consumed and also the corresponding emissions in building transport infrastructure such as roads and railways.

India is currently the number three polluter in the world and will likely rank next to China by 2025.The focus, therefore, has to shift to providing better mobility with less damage to the environment.

Policy initiative

The Government of India introduced the National Urban Transport Policy (NUTP) in 2006.

The most significant initiative in the policy had to do with integrating urban land and transport development and optimising road capacity. Another aim of the policy is establishing Intelligent Transport Systems (ITS) over a phased manner in the next 20 years.

However, according to all estimates the future lies in adopting hybrids and electric vehicles (EVs). A 2011 study on the prospects of EVs conducted by Deloitte Touche Tohmatsu Ltd. estimates the current potential of EVs in the Indian market at 4 per cent of the annual car sales in the country (or about 100,000 vehicles).

Frost & Sullivan forecasts that the market for electric passenger vehicles in India will reach 20,400 units by 2014-15 from 810 units a year in 2009-10. Similarly, the two-wheeler EVs market will grow from 0.14 million units in 2009-10 to 0.45 million units in 2015-16.

EVs come with a lot of inherent advantages. A conventional vehicle creates 2.5 gm pollutants per km, while a 100 per cent efficient electric vehicle generates 1.2 gm of pollution. Thermal plants which are used to generate electricity for charging EVs are not located in congested areas. So an electric vehicle definitely improves the local city environment.

What is even better is that according the Deloitte survey a little over 70 per cent of the respondents in India are willing to consider purchasing EVs if fuel prices cross Rs 85 a litre. The survey covered 13,500 respondents and spanned 17 countries including India.

Future of EVs

But OEM manufacturers are not too bullish on the future of electric mobility in India. “Where is the electricity or infrastructure to sustain green mobility?

Just because these vehicles can't travel long distances doesn't make them ideal for shorter rides,” opines Mr R.C. Bhargava, Chairman, Maruti Suzuki India.

Interestingly, acceptance in China is high. China, which has the world's largest number of charging stations, plans to have 20 to 30 per cent of its on-road vehicles converted to EVs by 2030 and has invested $15 billion to promote the concept.

“The Chinese experiment is based on thorough consumer research. An average city dweller in China does not travel more than 80 km per day. Besides, cities plan to provide charging facilities at more than 10 million electric charging stations. It is worth noting that China already has 100 million light electric bikes and scooters,” says Mr. M. Anand, Professor (Strategic Marketing), Faculty of Management Studies, Delhi.

Clearly, India too needs such proactive action if it is to save its environment and also provide healthy travel options to its citizens.

Related Topics
comment COMMENT NOW