Tata Curvv to Mahindra XUV.e9: India is ready for an EV offensive
India's recent announcement signifies a strategic shift in its approach to electric vehicles (EVs). The country plans to reduce import duties on specific EVs from manufacturers committing to invest at least $500 million and commence domestic production within three years. This initiative, part of a new e-vehicle policy, aims to attract substantial investments from major global EV manufacturers.
The policy revision is poised to heighten competition for domestic automakers, particularly with companies like Tesla and VinFast eyeing India's position as the world's third-largest car market. This comes at a time when the global EV market is experiencing a slowdown in growth. Despite EVs accounting for only 2 per cent of total car sales in India last year, the government is ambitious, aiming to boost this figure to 30 per cent by 2030.
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Electrifying development for Indian carmakers
Maruti Suzuki India, the leading automaker in the country by sales, is gearing up for a significant push into the electric vehicle (EV) market. The company plans to introduce six EV models by 2030, aligning with the growing demand for electric vehicles in India.
Suzuki Motor Corporation, which holds a majority stake inMaruti Suzuki, has announced that the group's first battery EV will be produced at Maruti's plant in Gujarat. This move underscores Suzuki's commitment to expanding its EV portfolio and leveraging Maruti's manufacturing capabilities in India.
Meanwhile, Tata Motors, dominating more than 80% of India's electric car market, is set to expand its electric vehicle (EV) lineup significantly. Over the next 3-4 years, the company plans to introduce 10 new electric models, aiming for EVs to constitute 25 per cent of its total car sales by 2025, a substantial increase from 9.3 per cent last year.
Currently, Tata Motors offers four EV models, including the latest iteration of its Punch EV, priced at ₹11 lakh. The company's commitment to expanding its EV range reflects its ambition to meet the growing demand for electric vehicles in India.
In 2021, Tata Motors secured $1 billion in funding from TPG's Rise Climate Fund, valuing its EV division at approximately $9.1 billion. This substantial investment underscores confidence in Tata Motors' EV strategy and its potential for growth in the rapidly evolving electric vehicle market.
Another Indian carmaker,Mahindra and Mahindra is also gearing up for a significant shift towards electric vehicles (EVs) in its SUV segment. The company anticipates that electric models will account for 20 per cent to 30 per cent of its SUV sales by March 2027. Currently, Mahindra offers an electric version of its XUV 400 SUV and intends to accelerate its EV strategy with the introduction of new electric SUVs starting from 2025.
To support its EV initiatives, Mahindra has secured approximately $400 million in funding for its EV unit. This funding, sourced from investors such as Singapore's Temasek and British International Investment, reflects confidence in Mahindra's electric vehicle plans and its potential for growth in the evolving EV market.
Mahindra's commitment to expanding its electric vehicle lineup aligns with the growing global trend towards sustainable mobility, positioning the company to capitalise on the increasing demand for electric SUVs in the market.
In a parallel development, the Indian conglomerate JSW Group has announced ambitious plans to invest 400 billion rupees ($4.82 billion) in electric vehicle and battery manufacturing projects in Odisha. This marks JSW Group's entry into the EV sector and highlights its commitment to sustainable mobility.
Moreover, JSW Group is reportedly in discussions with Volkswagen, the German auto giant, regarding the supply of technology and components for Volkswagen's EV project. This collaboration could potentially accelerate the adoption of electric vehicles in India and strengthen the country's position in the global EV market.
Also Read : EV policy to attract global players, help India become manufacturing hub: Experts
Hyundai Motor's Indian, too aims to make significant strides in the electric vehicle (EV) space, with plans to introduce five new EV models by 2032. This expansion will complement the two existing SUVs in its lineup, the Kona and Ioniq 5. Additionally, Hyundai aims to increase the number of its charging stations to 439 by 2027, enhancing the EV infrastructure in the country.
To support its EV ambitions in India, Hyundai has announced a substantial investment of close to $4 billion over the next decade. This investment will not only facilitate the launch of new EV models but also contribute to the expansion of charging infrastructure and the establishment of a battery pack assembly unit. These initiatives underscore Hyundai's commitment to the Indian market and its efforts to drive the adoption of electric vehicles in the country.
Upcoming global players
The new EV policy in India is also expected to attract major players from the global electric vehicle (EV) industry to the country. Under this policy, the government will significantly reduce import duties, slashing them from 100 percent to just 15 percent for imported electric vehicles with a CIF value of USD 35,000 ( ₹29 lakh) and above.
This move is poised to facilitate Tesla's entry into India, as the EV giant has been actively advocating for a reduction in duty on imported EVs as part of its India plans. Tesla's current lineup, including the Model 3, Model S, Model X, Model Y, and the Cybertruck, all fall into the price range that would benefit from this duty reduction. Additionally, Tesla is reportedly developing a more affordable EV known as 'Project Redwood,' which could potentially be manufactured in India in the future.
The policy announcement is also expected to be advantageous for Vietnam's Vinfast Auto, which recently signed an MoU with the Tamil Nadu government and commenced construction at its upcoming EV manufacturing facility in Thoothukudi. This facility, with an annual capacity of 150,000 units, is poised to benefit from the reduced import duties, enhancing Vinfast Auto's competitiveness in the Indian EV market.
