As India and the world continues to grapple with the worst pandemic of the century, economies across the globe remain slumped. Amid stringent restrictions of social distancing and extended lockdowns, most businesses continue to struggle.
Fortunately, the EV industry is looking at this crisis as an opportunity to finally make its mark in India. While the pandemic could create a temporary dent in the segment, it is likely to accelerate EV mobility in the long term.
In an exclusive webinar organised by The Blue Circle on ‘How Will the EV Industry Steer Around Covid-19?, prominent voices from the EV industry – Naveen Munjal, Managing Director, Hero Electric, Mahesh Babu, CEO, Mahindra Electric, Atul Arya, Head-Energy Systems Division, Panasonic, Amit Gupta,Co-founder and CEO, Yulu, and Pavan Choudary, CEO, Author and Public Intellectual, discussed the impact of Covid-19 on the EV industry and the way forward.
Positive outlook on EV
Setting a positive tone, Naveen predicts a shift in mindsets of people towards e-mobility.
During the lockdown, as people stay indoors, pollution has dropped and skies are clear and blue. He feels this is what people would want even post-Covid-19.
While an economic recession is predicted, Naveen feels the EV industry can be a beneficiary in some ways. “Every time you come out of a recession, it’s the bottom end of the vehicles, which take off the fastest, and that’s possibly going to happen here as well.”
With palpable fear amongst people regarding contracting the infection, social distancing is here to stay. Owing to increased adoption of hygiene practices, Naveen predicts the use of public transport will decrease. This will lead to greater thrust on personal vehicles.
“In this scenario, car buyers will look at price, cost of running, and ease and convenience,” said Naveen.
Echoing Naveen’s point, Pavan said, “While man’s desire to commute will remain, the spearhead will be the low cost product.”
Fear of supply chain disruption
Naveen was quick to reply, “It wouldn’t really affect the supply chain in the long run. As of now, we are receiving a large number of enquiries for the lower-end cars, driven on low cost lead-acid batteries. People will look at immediate cost right now, instead of the long-term cost. This will make cheaper batteries very important.”
Localisation would eventually happen, but even then India will rely on a few countries, for either batteries or components, notes Naveen. This is largely due to India’s lack of infrastructure to cater to this segment at this point.
While sharing that all components barring battery cells used in e-3 wheeler Mahindra Treo are manufactured indigenously, Mahesh pointed out, “India has the time to build an ecosystem, this is only the start. We are preparing ourselves for 2030 and 2045 and for that we need IPR to be developed in India and then a manufacturing base.”
According to Pavan, while globalisation might not completely vanish, it will become a thin crust over the bigger trends to localise. “Even if multinational collaborations are not there, there will be blocks of countries, which will flock together. We should have countries like China in our flock, so that supply chains do not get disrupted.”
Interest in e-three and four wheelers
Stating that the three-wheeler segment is the lifeline of India’s EV movement, Mahesh said, “When things become normal, eventually, people are going to look at more economically viable options of earning. With e-three wheelers, there is a thrill that you would be able to earn extra Rs 2000-4000 .”
“With regard to four-wheelers, India is embracing mass electric mobility in the low-end segment, which is the need of the hour for the urban,” he said.
However, he cautioned the companies in the three-wheeler and four-wheeler EV segment to be cognisant of the fact that the business model will change.”New usage pattern, new behaviors and new needs of the customers will arise, and we will quickly have to adapt our vehicles to cater to that segment. I believe that if we do that, then we have a very high chance of making an impact.”
EV startups to persevere
Amit highlighted that since Yulu bikes are self driven, people wanting to avoid shared mobility will prefer using them. “We are also sanitising our bikes multiple times a day,” assured Amit.
Yulu is a well-known EV startup that provides e-bikes for short distances or last mile connectivity in big Indian cities.
Started initially with bicycles, Yulu transitioned to e-bikes because of India’s climate and challenging ecosystem . “The reason why it is making sense for us and the consumer is because of the cost and financial goodness, which we are able to get out of EV,” shared Amit.
Speaking of challenges during covid he shared that though Yulu is one of those rare startups that has been operationally profitable from day one, currently their revenues are zero but overheads remain the same as pre Covid. “Everyone has taken a pay cut. This is the only way to survive.”
On being asked what he would advise other EV startups he said, it is important to somehow survive the next six months. “Don’t lose hope, stay on the crease. It’s kind of a test match environment. You need to stay on the crease and hopefully good things will happen.”
Batteries and charging infrastructure
According to Atul, electric mobility is still a small segment. While it will bear the brunt due to the pandemic, it will grow in the long run. “And the charging infrastructure will follow the same trajectory.”
Hygiene will impact the charging infrastructure growth in the short term. “You are handling a charger that has been used by multiple people, so there would be some amount of reluctance or hesitation as it would be with any public service,” said Atul.
He also believes that there will be a growing trend for personal vehicles, which will complement personal charging infrastructure and personal ownership of batteries.
On when will the charging station network, in its density, resemble the petrol station network, Atul said, “Probably never. Petrol and diesel are commodities, which due to safety issues, cannot be stored at home, in your office, or any other building.Whereas an electric vehicle can be charged at home or in an office, a basement of a mall or public parking space.”
On charging standards, he said that while several standards have been discussed, India is still trying to make a uniform ‘Bharat standard for charging’. “It’s a long process, which is taking even longer, and would perhaps take even longer because of the pandemic.”.
“It has slowed down things. Standardisation is something that shouldn’t have been delayed,“ he said.
Both Mahesh and Naveen feel partnerships are what will shape the industry going forward.
“I think EVs are a very thin space right now. I believe collaboration is the most important thing and we are open to add any partners but through merit.” said Mahesh.
Naveen concurred, “We are completely open to collaborations and partnerships and I think this is going to be a partner collaborative model .We could also be tapping into our supply chain in China.”
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