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Rising fuel prices have not slowed down the sales of passenger vehicles. Demand for Electric Two-Wheelers shows an upward movement
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Electric Vehicles (EVs) sales in India continues to be a tiny fraction of the overall sale of passenger vehicles in spite of the rapid increase in fuel prices seen in recent months. This, despite the claims from a section of the EV proponents that increase in petrol and diesel prices, may have changed the consumer mind space in favour of EVs as opposed to fuel-consuming vehicles. BW does the fact-check by comparing the data for passenger vehicle sales—Electric versus Regular and Electric 2-Wheelers versus Regular 2-Wheelers— to bring out the gap between the two categories based on sales and registration data points.
Sample this: In 2019-20, about 3.8 lakh electric vehicles (EVs) were sold in India (nearly 5.8 out of 10 were Electric 3-Wheelers, the balance was Electric 2-Wheelers & electric cars). In simpler terms, based on this data, an average of 1070 EVs were sold per day in FY20 of which an average per day sale of electric 2-wheelers stood at around 428 and that of an electric car stood at 4 per day in FY20.
Now let us peg that number against an average per day sales of 7,600-passenger vehicles (primarily cars) in that year based on a total annual sale of 2.77 million passenger vehicles in FY20. However, that will not give the true picture of comparative sales of passenger vehicle categories (Electric 2-wheelers in case of EVs) and regular 2-Wheeler sales. In FY20, the auto industry together sold 21 million 2-wheelers that run on fuel. An average per day sales, therefore, worked out to be 57,534 units of 2-Wheeler for 2019-20.
In layman’s language the size of 2-wheelers in FY20 was 134 times the size of Electric 2Wheelers. Overall, the sale of EVs continues to remain abysmally lower than those of fuel-based passenger vehicles, a point that must be underlined while comparing the two categories.
Fuel Price Impact on EV Sales?
In the past few months, however, the sale of EVs, especially the Electric 2-wheelers has been gaining traction, claim the manufacturers. Even a portion of the select data captures that trend though a detailed data set is awaited. As per Vahan data, the total number of registered e-vehicles (only hi-performance ones) stood at 3,909 units in January 2021 (Average sale of 126 per day in January), and 4,702 units in February 2021 (average sale of 168 per day in February which had 28 days). Now compare this to the total registration of passenger vehicles in January 2021 which as per FADA report stood at 281,666 or an average of 9,086 registered per day. In February, this figure was reported at 254,058 vehicles or an average of 9,073 vehicles registered per day.
Hero Electric, the market leader in the Indian electric two-wheeler industry expects record sales of 8,000 EV 2-Wheeler units in March, even higher than the 7,000 Electric Bikes it had sold in February.
"The recent fuel price hikes had a positive impact on the entire EV industry. Our dealerships have reported a surge in demand and a 50% increase in footfalls across markets,” said Naveen Munjal, MD – Hero Electric. “The real change drivers for the industry are EV’s efficiency, ease of use, and environmental benefits over fossil fuel-guzzling vehicles,” he added. Agrees Sohinder Gill, Director General, Society of Manufacturers of Electric Vehicles (SMEV). “Consumers are now trying to understand the running costs of EVs on the cost of per-charge generating how many kilometres basis. Some of the upward sales are on account of petrol price surge,” Gill said.
The recent hike in fuel prices has further pushed consumers to look for alternate in electric vehicles, said Okinawa Autotech, a leading seller of Electric 2-Wheelers. "We aim to provide the EVs that are at par with the ICE engine,” said Jeetender Sharma, MD & Founder, Okinawa Autotech adding that there is healthy growth in sales of Electric 2-Wheelers expected in March.
According to a CarDekho OMG survey, 66 per cent of potential customers are willing to buy EVs out of which 53 per cent said they were strongly inclined to go electric.
Is the fuel price surge adversely impacting the fuel-consuming vehicles? Rajesh Menon, DG, SIAM said, “Though a direct correlation cannot be established on the increase in fuel prices with that of sales of vehicles in the short term, however in the long run, rise in fuel prices could impact purchase decision of buyers.”