Why EV Industry is struggling despite Government Incentives? | EV Industry Challenges
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- čas přidán 7. 07. 2024
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The EV industry is booming in India and across the world. EV industry news is rife with Uber ordering more than 25,000 new EVs from Tata and startups like Evera raising millions of dollars in funding. The government is also incentivizing the rise of the EV industry in India. In this video, I’ve covered if everything is alright in the EV industry. With the rise of EVs, it is expected that some problems are bound to happen. We will try to understand why the EV industry has a massive supply problem along with other Ev industry challenges.
The government is giving PLI schemes to manufacturers. However, the issue EV production is facing is the lack of raw materials. The supply side issues are massive for the EV industry. If there are not enough raw materials then nobody can do anything. Manufacturers cannot produce if they do not have the raw materials. Even if the supply-side issues are resolved with the recent discovery of 5.9 Million tonnes of Lithium in J&K, then still there are other issues related to technology. Bill Gates and Tesla are investing in companies that are trying to improve the efficiency of the Lithium Ion Battery itself.
The purpose of PLI schemes is to push production in the economy. But as stated by Raghuram Rajan in a white paper, the PLI schemes don’t work for all industries. They work for the sectors where there is a natural advantage for the whole country. We are pushing EVs to solve the problem of high crude oil imports. Last year India has spent $119 Billion on crude oil. The government is also aiming to increase the demand for EV vehicles. The demand for EVs come from two components - demand for two-wheelers and demand for four-wheelers. The total number of cars sold in India last year was 38 Lakh units but out of this, only 50,000 cars were EVs. This means roughly 1-2%.
Somebody purchasing a car is purchasing it for comfort. People will buy EVs only as long as they offer the same comforts as an ICE car would offer. If it is not offering the same benefits from the customer's POV then people won’t buy it. There is still an onus on improving the charger and the battery so people can drive longer on the same charger and battery. The two-wheeler segment on the other hand isn’t very promising since people are very price-conscious on that end. Issues like the fire in the Ola scooter are also making EV adoption further difficult.
I’ve shared ideas on what the government can do to resolve the waning customer trust. In 2022 India sold I.5 crores of two-wheelers out of which less than 5% are currently EVs. The massive growth proposition makes the EV market a lucrative option for investors. The way forward for the government can be to build state-owned and maintained electric power stations for EVs as well as provide timely regulatory support to the customers. Hope you find this video valuable. Please let me know what other topics you’d like me to cover.
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I publish meaningful and valuable content on this channel. My aim is to make business news more accessible and easy to grasp. If you find my videos informative and insightful then make sure to subscribe and leave a comment. I’ll see you in the next video
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Chapters
0:00 - Intro
0:43 - Pointers
0:57 - Government role
1:58 - PLI Scheme
4:26 - Subsidies
6:35 - What more can Gov do?
7:55 - Way Forward
8:58 - Outro
Designing a uniform charging standard for EVs can be a good move to expedite the process of building a sizeable pan India charging infrastructure
The other potential alternative would be developing a better public transportation facility and promoting its more frequent use. Otherwise, focusing on flex-fuel car R&D as we have the natural advantage of growing a lot of sugarcane from which we could have ethanol.
Very informative video and as I have in real life people who buy EVs are usually using them as a secondary vehicle for city commute and totally making a joke of the environment argument because instead of having just a ICE vehicle now they have two or three vehicles and I would not blame just go and watch video of Faisal khan from motorbeam who got annoyed with his 1.5cr+ Benz because most of the power grid were inoperable in Pune to Mumbai route
You provide meaningful information thank you
I request if you can make a video on how environmental friendly are evs because for that need information on how much electricity is produced by coal and other clean energy like solar wind and thermal is important
Ironic that I just watched the previous EV related video from you today. I believe that supply chains will shrink even more as other industries other than automotive too start demanding the lithium resource.
Great content as always.
Much appreciated!
"The demand for EVs come from two components - demand for two-wheelers and demand for four-wheelers. The total number of cars sold in India last year was 3 Lakh units but out of this, only 50,000 cars were EVs. This means roughly 1-2%" , I suppose its 30 Lakh units and the 1-2% of that is 50,000 units. Its mentioned in your description above.
How do I have a chat with you Pavan
Interesting Analysis. Many thanks.
Could you please analyse something in the competition between CNG and EV? What are the current sales of these two types of variants and anticipated growth?
Charging Infrastructure is already being built Fortum TATAs are doing it.. pls do research o these 2 Cos
Apart from the government schemes, can we say that EV vehicles are finding it difficult to attain product market fit?
I believe so. Because of the problems related to range, charging duration, and safety aspects
Hi Pavan in EV, electricity is stored in batteries and for batteries lithium is needed. So what do you think on the hydrogen vehicles (which being in light for quite a while as government is also focusing on it now) is it going to replace EV? If lithium is not enough(upto now what we have found on earth) to power whole EV industry.
Hydrogen fuel cell technology vehicles also have great potential in comparison to BEVs.. There is lot of R&D going on in that space.. H2 vehicles are more suitable for trucks, buses and ship cargos in comparison to cars and bikes.. The problem with this technology is with generation of H2 n also with infra for fuel stations. we can expect it in the future with more advancements in tech.
I believe there is research going on even for Lithium alternatives. So, we will see this space soon. Not just with Hydrogen!
I think hydrogen will make sense if it is manufactured from green energy, it makes sense over ev for heavy duty vehicles where the range will not be issue with fuel cell technology but for lmv it does not make sense to use green energy , where it is more or like one is using green energy to generate electriciry then use it to extract hydrogen then again use hydrogen in fuel cell to generate electricity
I don't think ev is struggling look at 2 wheeler electric sales number they are growing at rate of 20-25% every month