State of EV Adoption in India

• The global average of EV adoption stands at 13.3%.
• In Asia, the average EV adoption rate is higher at 17.3%.
• A look at EV adoption in different countries reveals a wide disparity:
  • China is at the forefront with an EV adoption rate of 27.1%
  • South Korea sees an adoption rate of 10.3%
  • India lags behind with a mere 1.1%
  • Other Asian countries like Indonesia, Vietnam, Malaysia, the Philippines, and Thailand have adoption rates ranging from 0.1% to 2.5%.
  • Japan has an adoption rate of 2.2%, which can be attributed to the government’s support for various clean technologies such as hybrids, plug-in hybrids, fuel cell vehicles, and lithium-ion battery -powered vehicles.

Learn more about electric vehicles in the linked article.

Government Initiatives and Current Scenario:

• The Indian government has set a target to achieve 30% EV adoption by 2030. However, as of now, 90% of EVs in India are two and three-wheelers.
• If we include two and three-wheelers, barring e-rickshaws, the overall EV adoption would be around 4.5%.
• There is an urgent need for rapid growth and diversification of EVs in India.

Asian Dominance in the Supply Chain:

• Asian countries control a whopping 98% of the battery cell supply, with China, South Korea, and Japan being the key players.
• Chinese CATL and South Korean LG EnSol dominate almost half of the global supply, while Japan’s Panasonic is a major supplier for Tesla.
• India is yet to make a mark in battery cell production.

The Role of the Production-Linked Incentive (PLI) Scheme:

• India’s PLI scheme aims to build 50 gigawatts of battery capacity using advanced chemistry cells within the next two years.
• This scheme has the potential to be a game-changer by boosting domestic production of battery cells.

Opportunities in Raw Materials:

• India has recently discovered 5.9 million tonnes of lithium in the Union territories of Jammu and Kashmir, and more reserves have been found in Rajasthan.
• Indonesia, the largest nickel producer worldwide, is heavily investing in battery-grade nickel, a crucial raw material for EV batteries.

A Comparison of EV Adoption Among Major Auto Manufacturers in Asia:

• Tata Motors holds the seventh position among traditional internal combustion engine (ICE) car companies, with approximately 6% of their total sales coming from EVs. They aim to increase this to 20% by 2026.
• Japanese auto manufacturers like Nissan, Honda, and Toyota have lower EV adoption rates of 1-3% in 2022.
• South Korea’s Hyundai and Kia have an EV adoption rate of 10%, while Chinese automakers Geely, Geely Auto, and Dongfeng range from 14% to over 26%.

The Road Ahead:

• The low rate of EV adoption in India calls for substantial efforts to keep pace with other Asian countries.
• Enhancing domestic production, tapping into raw material resources, and supporting various EV technologies are crucial for India to emerge as a significant player in the EV and supply chain sectors.