In the pulsating heart of India’s automotive sector, a silent revolution is underway. Fueled by government incentives, burgeoning awareness, and a flurry of new product releases, the electric vehicle (EV) landscape is undergoing a seismic shift. This transformation isn’t just a passing trend; it’s a fundamental reimagining of how we move.
Over the past two years, EV penetration has surged to 4.7% in FY2024. While electric two-wheelers spearhead this charge, the ripples are felt across segments, from e-three-wheelers to electric buses. Yet, amidst this electrifying momentum, a stark reality emerges: localization remains a challenge. Currently, only 30%-40% of the EV supply chain calls India home.
But where challenges lurk, opportunities abound. Enterprising auto component suppliers eye a burgeoning market, ripe for innovation and investment. As the demand for EVs skyrockets, so does the hunger for indigenous solutions. The call for localization echoes loudly, particularly in critical components like battery cells, which continue to be imported.
Shamsher Dewan, a luminary at ICRA Limited, underscores the urgency: “India must foster its own battery ecosystem to fuel mass EV adoption. The road ahead is fraught with challenges, from technological hurdles to raw material scarcity. Yet, the prize is tantalizing: a thriving, self-sufficient EV industry.”
The forecast is bullish: by 2030, EVs could command a quarter of 2W sales and 15% of passenger vehicle sales. This translates into a staggering market potential, with E2W components alone poised to exceed INR 1,00,000 crore by 2030 while the e-passenger vehicle (EPV) component is foreseen at another INR 50,000 crore at least, in terms of revenue potential for ancillaries. The wheels of progress are turning, and auto ancillaries are seizing the moment. Investments surge, collaborations bloom, and a new era dawns upon the automotive horizon.
But this transition isn’t just about replacing gears with batteries; it’s a holistic reimagining of mobility. Engine and drive transmission components brace for impact, yet new avenues beckon, from alternative applications to export frontiers. The road to electrification may be winding, but its destination is clear: a cleaner, greener future, powered by innovation and driven by determination.
