India's electric car market share is expected to rise to 7 percent by FY28, embarking on a rapid expansion backed by a five-fold growth public charging infrastructure in last three years, a note by ratings advisory CareEdge said on July 16, adding that the rare earth supply disruption by China needs to be addressed, along with new launches and government push for EV infrastructure.
The report of a 'high-growth trajectory' for EVs from CareEdge comes at a time when India's electric vehicle space has seen major activity as Tesla launched its 'experience center' to offer imported cars, and Vietnam-based Vinfast opened bookings for two of its models.
India has been aggressively ramping up the charging infrastructure for EVs, as evident in the the number of Public EV Charging Stations (EVPCS) which have grown nearly five-fold in the last three years, according to the report. These efforts are being supported by OEMs to complement the ramp up.
"As of early FY25, India had only one public charger for every 235 EVs, compared to one per 7–15 EVs in developed EV markets like China, the EU, and South Korea," the CareEdge note said. The Indian government has committed to achieving 30 percent EV penetration by FY30.
Aside of the push for charging infrastructure, the note said India needs to resolve in a time-bound manner the rare earth supply disruption from China, currently hampering production timelines for some automakers. India also needs a sustained lineup of new electric models to keep the buyer interest high, along with government support for a nationwide charging ecosystem.
India's push to localize EV batteries will be a major factor to support the future growth of electric mobility in India, CareEdge said the note, highlighting that battery packs 'continue to account for 35–45% of the total cost' of an EV. Currently, India imports nearly all its lithium-ion cells, majorly from China, South Korea, and Japan. "...battery localisation, along with customs duty exemptions and economies of scale, could reduce battery costs by 20–25% over the next 3–5 years," said CareEdge.
"One of the biggest things is that there has to be a policy framework where there is a UPI moment for charging ecosystem wherein you can use a singular app, get your vehicle charged and pay seamlessly", Santosh Iyer, Managing Director & CEO, Mercedes-Benz India had previously told Moneycontrol.
India needs capital expenditure to the tune of Rs 16,000 crore to meet the growing public charging demand for electric vehicles (EVs) and achieve the target of 30 percent electric mobility by 2030, according to a FICCI report.
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