Tata Motors joins Motown chorus, raises concerns on EV deadline

The auto industry might be making big strides towards electric mobility by showcasing new launches and concepts in the upcoming Auto Expo but the concerns on high investments and infrastructure remain.

Unless there are enough incentives for companies to set up infrastructure related to electric mobility, besides a firm policy to push up the adoption, the government’s mission of full electric mobility by 2030 will not be met, according to a senior executive from an automobile major.

Tata Motors CEO and MD Guenter Butschek on Tuesday said the government’s vision of attaining 100% electrification of public transport and 40% of personal mobility by 2030 is a ‘huge challenge’ that will require a single-minded focus. “It is a huge challenge, from a vision point of view; from an aspiration point of view, it is a good timeline. But in order to get even close to it, we need to draft and translate it into a policy.”

In December last year, Mercedes-Benz had urged the government not to rush with the all-electric vehicles (EV) push foreclosing better technological options for future generations as the rest of the world is racing to run on hydrogen and not electricity.

It also said a less ambitious plan of promoting e-cars should be adopted as a nationwide electrification of the auto industry is just not viable both commercially and technologically.

Earlier in 2015, the government had launched a scheme -- Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) to promote clean fuel technology cars which could not find success.

India imports over 80% of its oil requirements, and the oil import bill is expected to touch $85 billion this year. Besides, a need for reduction of pollution, the government also needs to reduce its carbon emissions by 2030 which is why there is a focus on finding alternatives to fossil fuel.

Earlier, DNA Money had reported that the push and pull between the government and auto companies remains as the latter is still not confident about meeting the deadline of 2030. SIAM had also submitted a White Paper on electric vehicle to the government indicating 100% electric for public mobility and 40% electric for personal mobility by 2030 and taking it further for a complete shift to electric vehicle regime by the 100th year of India’s independence.

Abhay Firodia, president, SIAM, had said that the proposed policy measures in the White Paper would be needed for creating a robust market and manufacturing eco-system for electric vehicles in the country and such a policy must be sustained over time to remain stable to enable the industry to commit to investments with full confidence.

Butschek said, on an assumption, that Indian passenger vehicles market will touch around 10 million units annually by 2026, around 20% -- 2 million-- could be EVs and the rest ICE, with a good portion hybridised.

The incentives must be directed towards full EVs alone as the industry would have to develop other technologies such as hybrids in order to meet regulatory requirements going ahead.

This is required to help the EV technology stand on its feet, create scale and help achieve economies of scale to attract the attention of different players to commit on the investment in building the electrification infrastructure for mobility, he said.

As far as hybridisation is concerned, it will be the bridge during the transition from ICE to EVs. There is a requirement of huge investments in infrastructure and ecosystem, where incentives must be targeted. “You need to incentivise in order to make it attractive (for buyers) to spend more for possibly a small car, which is probably less aspirational in its appearance or in its segment that the same money on a hybridised larger car,” he said.

(With agency inputs)