Over the last few years, automation and digitization have transformed the Indian automotive industry and initiated ground-breaking business models that are in sync with global disruption. The Indian government’s announcement that it will be increasing the budget for supporting electric vehicles in the country to $1.3 billion, or ₹8730 crores, under the second phase of the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme is simply one of many steps in this process.
India is one of the world’s largest mobility markets and it is witnessing radical improvements in the expansion of urban mobility. The government is thus looking at revamping legal frameworks to cater to these developments and many changes are expected in the near future. In 2017, India announced its vision of “All Electric by 2030” and even though the Indian automobile industry is the sixth-largest in the world and accounts for 22 percent of the country’s total manufacturing output, this announcement set pulses racing. Additionally, the upcoming shift to making vehicles that are BS-VI compliant across cities is also due to play a crucial role in expanding the industry’s share in India’s GDP.
However, E-mobility is undoubtedly the single biggest disruptive trend that is altering the global and Indian automotive industry and determining the future of mobility. Manufacturers across geographies are responding and either developing new products, exploring new partnerships or leveraging new business models altogether. In that context, bringing electric vehicle components to life, hiring the right talent and improving the performance of electric batteries are key factors that are bringing significant automotive disruption in India.
To cater to the growing demand and supply of E-mobility, what will also be essential are – conservation and augmentation of electrification projects, enhancements in urban connectivity, rise of autonomous driving and penetration of shared mobility through radical urban designs and last-mile connectivity improvement of public transportation. While the onus for these falls on the government, larger organizations are playing their part by focusing not only on production but on development as well. They are increasing the supply of the electric powertrain and thereby increasing the efficiency of propulsion systems by integrating transmission, power electronics and motors into an electric axle, for instance.
This is driving established global OEMs to either kickstart their own E-mobility programs or partner with tech companies for success roadmaps. But none of this will be possible unless consumer don’t buy in to the concept of E-mobility. For electric vehicles to gain market share from ICE (Internal Combustion Engine) vehicles, investments need to be encouraged. Steps to achieve this include development of infrastructure for electric cars, access to easy and reasonably priced charging and growing awareness about the environmental benefits of E-mobility as there are no carbon emission compliance regulations to be met.
Electrification is thus poised to play a big role in the future of mobility once the challenge of meeting BS-VI implementation has been overcome. OEMs will get increasingly influenced by government regulations and market pull factors to venture away from their traditional business models and legacy production facilities. Additional factors such as connectivity, autonomy, shared mobility and more will play significant roles in attracting customers and for the automotive industry in India, this looks likely to be a time of major upheaval and change.