Electric vehicle fire incidents unlikely to impact long-term EV sales: Crisil

Since the starting of summer season in the country, there have been multiple incidents of electric vehicles catching fire. However, these incidents are unlikely to have any long-term impact on the sales of battery-powered models in the country, though there could be an immediate perception that whether these vehicles are safe or not, credit rating agency Crisil has said.

In a recent incident reported from Nashik in Maharashtra, a group of 20 of 40 electric scooters caught fire while being loaded in a container. Earlier in March, about four incidents of electric scooters catching fire were reported, including scooters from brands like Okinawa and Ola. The incident reported from different places in the country prompted the government to order a forensic investigation.

These incidents will have a near-term impact which is a little negative for the segment. "But over the long-term, I don't think this is going to be an impediment (in EV sales). This is a new age industry and any such industry will find teething issues," said Hemal Thakkar, Director at Crisil.

He added that globally the EV industry has seven to eight players who dominate the market whereas in India there are some 25-30 companies and startups, which are into the manufacturing of two- and three-wheeler EVs. "So, of course, the kind of process they have at their end they will also go through the learning curve. And the industry will take some time to attain maturity," he said.

As an immediate perspective, there could be formation of a perception that whether these vehicles are safe or not," he said, adding that the government has already started an independent probe into the fire incidents so as to find out the cause or reason behind these incidents.

(with inputs from PTI)