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EV Adoption – A problem worth investing into!

EV Adoption – A problem worth investing into!

India is seeing a flurry of activity in the clean mobility space. From the design and development of Battery Technology and Charging Infrastructure to the manufacturing and assembly of Electric vehicles, there are numerous startups and SMEs who are vying for a share of the market. Millions of dollars of Venture Capital have already been invested into advancing the pace of development in this space. However, there is one area that is still unaddressed – EV adoption. So, what really dictates EV adoption?

Fears Associated with owning an EV

To a vast majority of the Indian middle class, owning a vehicle is a means to an income. Either the vehicle is used to ply them to and from their workplace, or transportation itself is their source of income. When a family’s income is dependent on the robustness and reliability of their mode of transport, then change is something that is unacceptable. Owning an EV changes a lot of things – from not being able to drive anywhere carefree (since EVs have specific range and one needs to be cognizant of how much range is left), to putting your entire trust on the electricity supply (for the EVs to be charged), there is a lot of behavioral change that an EV will demand from its owner.

A large majority of first time 2-wheeler EV buyers got a chance to try out the experience of riding an EV through one of the last mile rental fleets. Since then, most of these fleets moved towards a B2B approach where their 2-wheelers are being used by e-commerce delivery companies. The phase where most of the Tier 1 cities had EV fleets that a rider could rent through a mobile app is now over. However, the perception that an individual buyer has of a 2-wheeler EV changed because of the massive adoption of 2-wheeler EVs by delivery companies. Misuse and abandoning of these 2-wheeler EVs are a common sight in all cities where fleets are operational. And I think this is THE biggest barrier that a common person has towards buying a 2-wheeler EV for personal use. The fear that these vehicles can give up right in the middle of the road, and that no roadside repair shop will be able to help him.

In the last few months, the industry has given more reasons to individuals to NOT own an EV, rather than inducing confidence in the buyer. A recent phenomenon is that of batteries catching fire, overheating, and bellowing smoke, or causing short circuits. Even the smallest of electrical appliances are often kept disconnected at night in most households due to the fears associated. However, since EVs take a lot of time to get fully charged, they need to be plugged in and switched on all night. And even some of early adopters who were brave enough to charge an EV inside their 4 living walls, were treated to rude shocks. Multiple cases of EVs on fire causing deaths or harm to its owners have been reported in the recent past. The fear that a malfunction in an EV can cause irreparable damage to oneself and their family, is probably the biggest barrier to EV adoption.

Where is the good news?

All the problems mentioned above can easily be solved through regular maintenance and checkup of these vehicles. Ensuring that the most important component of the EV, i.e., the battery is in good health itself will take care of most EV related anxieties. Battery technology is a rapidly evolving space and with each passing day, batteries are getting lighter, more efficient, and safer. However, proper maintenance and check-up of these energy storing devices will always lie at the heart of a healthy EV. From an OEM (Original Equipment Manufacturer) perspective, manufacturers can ensure that high quality locally developed batteries are preferred so that both support and maintenance issues can be handled locally.

About the Author

Akshay Sasikumar is the Managing Partner at www.82advisory.com, a firm that specializes in Capital Strategy and investment banking services for technology companies.