Electric vehicle market to grow at CAGR of 49% between 2021-2030: IESA report
Indian electric vehicle (EV) market would expand at a CAGR of 49% between 2021 and 2030 and is predicted to reach annual sales of 17 million units by that time, with almost 15 million of those projected to be electric two-wheelers, said the “2021 India Electric Vehicle and Component Market Overview Report 2021-2030” report released by India Energy Storage Alliance (IESA). It adds, “Between 2021 and 2030, the yearly battery demand is anticipated to increase at a CAGR of 41%, reaching 142 GWh. The market is of 6.5 GWh, just like in 2021.”
According to the survey, the EV industry in India experienced one of the quickest recoveries from the pandemic-induced slowdown in 2020. The e-2Ws (50 percent market share), followed by the low-speed e-3Ws, accounted for most of the 4,67,000+ annual EV sales in India in 2021; however, other segments also showed notable increase over the course of the year. The research report routes three different market projection scenarios for the ensuing decade.
According to the report, the Indian EV market is anticipated to grow quickly after 2024–2025 as the initial costs of EVs are predicted to be comparable to those of ICE vehicles because to falling battery prices, advancements in EV technology, domestic production, sand economies of scale. Lead-acid batteries continued to dominate the Indian EV ecosystem in 2021, accounting for 81% of the market; this is due to the high demand for e-rickshaws. The market share of lithium-ion batteries has been steadily growing, and in 2021, for the first time, the demand for these batteries exceeded the 1 GWh threshold. Additionally, among lithium-ion chemistries, Lithium Iron Phosphate (LFP) is chosen option for e-3Ws and e-4Ws whereas Nickel Manganese Cobalt (NMC) is the preferred option for e-2W and e-buses.
The FAME II programme, which has been extended to 2024, was launched by the government to look into ways to make EVs cheaper and attractive to the end-users. By December 2021, the scheme has benefited more than 1.8 million automobiles. FAME Incentives for e-2Ws have also been raised from Rs 10,000/kWh to Rs 15,000/kWh in a recent policy revision.
According to the report, the main factors propelling the EV market’s expansion in the current decade will be rising consumer awareness; rising fuel prices; commitments from fleet aggregators and corporations; entry of new players; advancements in EV technology; continued subsidy support from both the Central and State governments; and anticipated implementation of strict emission standards (CAFÉ norms from 2022).