Even though no subsidies were rolled out for electric vehicles during the Union Budget 2013, Mahindra & Mahindra (M&M) has decided to go ahead with the launch of its new electric passenger car, the Mahindra Reva E2O in the Indian auto market. Finance minister did agree to provide benefits during import of critical electric components such as batteries and others, but did not unveil the National Mission for Electric & Hybrid Mobility. Through the National Mission, a National Electric Mobility Mission Plan (NEMMP) 2020 has created the vision and targets for availability of electric and hybrid vehicles in India by 2020, but no benefits were passed on to the Reva E2O.
Presently, production of electric and hybrid vehicles in India is negligible, which M&M hopes to turn around with the E2O. As per Mahindra Reva, though the initial purchase cost for an electric vehicle is high, it incurs a cost of only 50-60 paisa per kilometre. In comparison to this, a diesel vehicle’s running costs are much higher at Rs. 3-4 per km and so are the costs for petrol vehicles (Rs. 5-6 per km). Originally, M&M had set an internal target of pricing the E2O within15-20% premium of the existing top hatchback cars like Maruti Suzuki Swift and Hyundai i20. However, since subsidies have not been rolled out, M&M may revise its targets.
Chief of Technology and Strategy at Mahindra Reva, Chetan Maini felt dissatisfied that there were no provisions in the budget for accelerating growth of electric vehicles in the country. He said, “On one hand the government is talking about energy security and tackling urban pollution, and the medium to resolve these issues through electric cars was not supported. While the electric vehicle policy was announced a few months back, we are hoping for it to be implemented quickly, so that the much needed subsidy is extended for the segment to grow.” Currently, the E2O would be priced at par with vehicles such as Maruti Swift, but had the subsidies been rolled out, it could have been less expensive by 1 lakh INR.
As per the heavy industry statistics, 6-7 million electric vehicles are running on Indian roads, but these are mostly buses and two wheelers. Based on implementation of the NEMMP 2020, a support of Rs. 23,000 crore could be provided over 8 years. Keeping this in mind, Pawan Goenka, Automotive President for M&M was quoted as saying, “Once the mission plan is implemented, everyone will get into the electric vehicle space, which will help in development of charging infrastructure as well. If we get a good response for NXR, we may come out with three to four more products.” It is expected that the E2O will have a top speed of 100 kmph.
The company would aim at providing information about the benefits of electric cars to the common man, which would be the key to growth. M&M has tied up with State Bank of India, power company BSES and various malls in India to provide charging stations for the E2O. 100 stations are located across Delhi and Bangalore and this should number should go up to 300-350 within the next few years. The car battery may also be leased, in an attempt to further lower ownership costs.