Hybrid Vs EVs: Who will lead the market share battle?

Automakers are placing more and more faith in hybrid vehicles as the market for battery-powered vehicles declines globally.

The market-share difference between electric vehicles (EVs) and hybrid and sport utility vehicles (SUVs) has shrunk due to the quicker growth in sales of hybrid vehicles, reported The Economic Times.

In contrast to EVs, which are predicted to witness a minor reduction of 0.2 percent to 27,242 units, hybrid electric vehicles (HEVs) are predicted to have a 38 percent rise at 22,389 units, securing a market share of 2.1 percent. According to fiscal Q1 predictions by Jato Dynamics, plug-in hybrid sales will increase by 13 percent, from a tiny base to 35 vehicles.

Amidst the decline in EV sales, HEV and PHEV sales have also been increasing globally. Over the last several months, growth in the US has exceeded EVs. Thus, according to a recent Goldman Sachs report, worldwide HEV sales might surpass the expectations by 1-2 million vehicles, the report said.

Also Read: Hyundai Motor Group plans hybrid cars for India in strategy shift: Report

Hybrids provide a quick, affordable fix, even if EVs are essential to long-term climate goals. Experts argue that customers may find hybrids as a desirable alternative because of their fuel economy, cheaper running costs, and lower pollutants.

As for lowering carbon footprint and reliance on fossil fuels, Toyota thinks that hybrid electric vehicles (HEVs) are one such technology. As to Vikram Gulati, EVP of Toyota Kirloskar, Toyota possesses all the technology needed for electric vehicles and believes in introducing them according to the specific needs of the market and context to reduce the use of fossil fuels and attain carbon reduction as quickly as feasible, it added.

The internal combustion engine mode, electric mode, or both modes combined, can be operated using the self-charging HEV technology, resulting in a 40–50 percent increase in fuel economy, a reduction in running expenses, and a decrease in carbon emissions, according to Gulati.

On the other hand, Tata Motors has emerged as the leading player in electric PV thanks to its multi-powertrain approach. During a recent investor meeting, Tata Motors stated that it will increase its market share of EVs and CNG by the end of this decade with new product introductions such as iCNG Nexon. According to the company's ambition to "mainstream EVs in India," ten new EVs would be introduced by FY 26, the report said.

Experts in the field predict that this fiscal year, sales of hybrid vehicles may surpass those of electric vehicles thanks to the impending introductions of Hyundai and Kia. With its self-charging technology, Toyota and Maruti Suzuki continue to lead the hybrid industry by offering a workable way to reduce emissions without requiring large-scale charging networks, ET reported.

A modest increase in demand for EVs is anticipated as carbon neutrality is sought after. Automakers are placing more and more faith in hybrid vehicles as the market for battery-powered vehicles declines globally. This is because hybrids fulfill strict pollution regulations and offer larger profit margins, said Ravi Bhatia, regional director, of Jato Dynamics.

The market's progressive shift towards more environmentally friendly and sustainable alternative fuel technologies is seen in the increasing popularity of BEVs, HEVs, PHEVs, and CNG automobiles. Bhatia continues, "In India's automotive future, this shift is crucial for reducing emissions and enhancing energy security," according to the report.

Also read: EV slowdown steers the world further off course from net zero

A top executive from a major automaker stated that although electric vehicles have tax benefits, hybrids do not have high acquisition expenses. Hybrid cars are subject to a 43 percent GST rate, whilst electric vehicles are now subject to a 5 percent GST rate. With the exception of Japanese businesses, the majority of automakers depend only on fully electric vehicles to meet carbon reduction targets due to regulatory pushes towards EVs.