Wednesday, September 6, 2017

ELECTRIC CAR SPECIAL......,ALL CHARGED UP

ELECTRIC CAR ALL CHARGED UP

How manufacturers -and not just of cars ­ are gearing up for the massive opportunity that's up for grabs in the electric vehicles space in wake of the govt's big 2030 dream of only electric cars plying in India
I have been asked this question ever since I joined Mahindra & Mahindra (M&M) in 1991. We're still alive and thriving against competition.“
The question: How does M&M stack up against competition? The person answering: The chairman himself. “We're marathon runners...like our vehicles.Never underestimate us,“ says Anand Mahindra. The context: The opportunity in one of the next frontiers of automobiles, electric vehicles (EVs), where M&M is distinctly a first mover but where competition of all hues -from Elon Musk's Tesla to homegrown startups -is a charging point away.

Mahindra Electric, which makes models such as the eVerito and e20, sells some 100 EVs every month.That's a small start, but an ideal launching pad for the opportunity ahead to scale up volumes.

Consider: The government will soon float tenders for battery swapping and charging stations, as well as battery and cell manufacturing, in its bid to achieve power minister Piyush Goyal's dream of having only electric cars on Indian streets by 2030. Early this month, the stateowned Energy Efficiency Services (EESL) invited global bids for 10,000 electric sedans that will run up to 150 km on a single charge.

“Whether the future will come in one year, five years, 10 years or 15 is not certain, but it will happen. No automaker can ignore EVs,“ says Pawan Goenka, managing director, M&M.


EVOLUTION OF THE EV

Rate of EV adaptation will depend on battery prices coming down, driving range going up, charging infrastructure coming up, more and more automakers launching multiple EV models, aggregators realising the value of EVs in their fleet, government incentives continuing and on the government catalysing the use of EVs, Goenka said. “We were perhaps ahead of our times in bringing EVs to the country when the market was not quite ready. As volumes pick up, we will be ahead of others with reliable and affordable vehicles.“

Mahindra is also working on swappable batteries, where charging stations can replace smaller batteries appropriate for buses and three-wheelers. Currently, batteries are more of the entry-level 48V and 72V variety, which will be increased to 380V and 650V. M&M will launch the high-end powertrain, 380 volts-plus, in the higher end range of cars, said Goenka.

Through joint ventures and licence agreements, these batteries can be sold to other potential manufacturers in the EV space. Goenka expects to sell 5,000 vehicles in 18-24 months, from the current levels of 100 a month. M&M has invested about `500 crore in the EV business and recently committed an additional `600 crore for the next two to three years. It currently imports cells, packages them into a battery and fits it on to the vehicles.

“The first-mover advantage lies less in the technology, which is constantly evolving, and more in the data we have collected. Right from the first customer of Reva, we have information on driving patterns and driver behaviour and requirements that is worth its weight in gold,“ explains Mahindra.

M&M is conducting pilots with online cab aggregator Ola while corporate EV fleets in Delhi and Bengaluru are being conducted for better understanding and technical and commercial viability. Over eight to 10 years, taxi aggregators will be all EVs, as it makes more economic and environment sense for cities, reckons Goenka. It's not just M&M responding in a big way to the government's 2030 vision. A transport ministry official requesting anonymity said more than 30 auto companies are working on different kinds of EV projects.


Tata Motors, in collaboration with its U K subsidiary Tata Motors European Technical Centre (TMETC), has been working on an electric Tata Tiago, which is expected to borrow heavily from the Bolt BEV, the electric version of the Bolt. The Tiago could be the first passenger car from the domestic auto major to have an electric motor, say sources close to the project. The auto major is also testing electric commercial vehicles and has started test drives for the first batch of electric buses under the Marcopolo brand in Shimla. It's also considering an electric version of the Nano as otherwise the small car is no longer viable. 

Bajaj Auto is working on electric three-wheelers as part of its EV strategy. 

Nissan which along with alliance partner Renault is “the worldwide leader“ in EVs, according to chairman Carlos Ghosn -will undertake a pilot project in partnership with government bod ies and the private sector players to assess the viability of EVs in India.The best-selling five-door hatchback Nissan LEAF will figure in this plan. Nissan LEAF has sold over 270,000 units globally, says Arun Malhotra, managing director, Nissan Motor India (NMIPL). For several months in 2017, the best-selling car in Japan was the Nissan Note ePower, an EV with LEAF technology and a small, highly-efficient petrol motor that charges the battery from inside. “So you don't need any external charging infrastructure. We believe the ePower could be a fantastic gateway to accelerate the path to 100% EVs for India,“ says Malhotra.

Hero Electric, which has been selling electric scooters for eight years now, feels traction for EVs is increasing. “EVs are catching on now because of reducing lithium battery prices and increased subsidies,“ says Sohinder Gill, global CEO, Hero Electric. For instance, there is a subsidy of `17,000 for Hero's 250 watt lithium battery scooter, and of 22,000 for the 1200 watt lithium battery model, explains Gill.

Electric scooters with portable lithium batteries have a substantial advantage over the lead battery ones. These include easy and fast charging, low running costs, reduced maintenance and reliability. This, says Gill, is making such models an option worth considering for a two-wheeler buyer.

The 12% GST on EVs, combined with a `1 lakh benefit under FAME (Faster Adoption & Manufacturing of EVs) scheme and a road tax waiver in some states, has come as a big relief for manufacturers of clean energy vehicles. Meanwhile, the falling cost of both solar power and energy storage in the form of lithium ion batteries (LiBs) is also driving adoption. This shift is being driven by government policy and technological advancements and this disruption has already impacted industries in the US, Europe and China. Globally EV sales have risen eight times in the US and 66 times in China since 2011; this is attributed to falling LiB costs (battery costs have fallen by more than 80% since 2008 while battery density has increased more than five times over the same period) and a move towards cleaner fuel, according to a recent Ambit Capital report.

It's not just carmakers who are exploring EV opportunities. The Sajjan Jindal-led JSW group, which has power, steel and mining operations, will diversify into EVs; it aims to roll out its first such vehicle by 2020. JSW Energy will manufacture EVs, electrical batteries and energy storage systems and charging infrastructure. It is scouting for a technology partner in EV space, as well as for a supplier for the electric powertrain.

Stanford economist Tony Seba recently published a futuristic forecast of a potential doomsday scenario for a number of traditional industries that use petroleum and coal as a source of energy. Specifically, he said no more petrol or diesel cars, buses or trucks will be sold anywhere in the world in eight years.The entire market for land transport will switch to electrification, leading to a collapse of all prices and demise of the petroleum industry.


Such predictions are just the impetus the EV sector needs, along with rapid technological progress. For instance, the moving parts in an EV are much lower than in a conventional car. Seba claims in his report that an internal combustion engine drivetrain contains about 2,000 parts, while for an EV it's just 20.

The Society of Manufacturers of Electric Vehicles estimates 20,000 electric two-wheelers and 2,000 electric cars were sold in fiscal 2016.That's less than 1% of total annual vehicle sales. High capital costs -battery costs account for 30% -lack of charging infrastructure and the fear of running out of battery are some factors in the way of mass adoption. All that, however, will change sooner than later. As Mahindra, the eternal optimist, puts it in the M&M context, “It's a seamless evolution of our core mobility business.“

Lijee Philip

Aug 29 2017 : The Economic Times (Mumbai)


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