Electric vehicles are transforming transportation and reducing carbon emissions. Manufacturers and inventors are constantly pushing the envelope to make EVs more affordable and effective, from better battery technologies to better charging infrastructure. But there are challenges along the way to broad EV adoption. There are still challenges to overcome, such as range anxiety, a lack of adequate charging infrastructure, and expensive starting expenditures. Despite these obstacles, governments, corporations, and consumers are becoming more and more committed to electrification as they realize the long-term advantages for energy consumption and the environment. Compared to conventional cars, electric vehicles are quieter and offer a smoother driving experience. EVs are more comfortable for both drivers and pedestrians because they don’t have a combustion engine, which reduces engine noise. Additionally, EVs’ regenerative braking technology makes deceleration smoother and more regulated, which prolongs brake pad life and lowers maintenance expenses.
The Worldwide Electric Vehicle Industry
Due to shifting customer preferences and technological improvements, the worldwide electric vehicle industry has grown significantly in recent years. The creation of more durable and effective batteries is one of the major developments in electric car technology. Longer driving ranges between charges are now possible thanks to advancements in the energy density of lithium-ion batteries, which are frequently used in EVs. Range anxiety, a major worry among prospective EV purchasers, has been reduced as a result of this advancement.
Tier-one Indian Auto Buyers Considering an EV
McKinsey&Company in a report states that compared to the record-high global average of 52%, 70% of tier-one Indian auto buyers said they would be open to considering an electric vehicle for their next vehicle. Even if the market for internal combustion engine (ICE) vehicles in India has grown recently, the swift switch to electricity marks a significant turning point for the nation. Driven by a shift in global climate policy, central and state governments have developed efforts such as the Faster deployment and Manufacturing of Electric Vehicles (FAME) scheme to speed up the deployment of EVs. In an effort to improve traffic and lower air pollution, a number of cities have also implemented access restrictions for internal combustion engine vehicles.
With a definite preference for full battery electric vehicles (49 percent) over plug-in hybrid electric vehicles (21 percent), the overwhelming majority of individuals are considering EVs for their next automobile purchase. These inclinations are in line with our study on electric two-wheelers, which found that 86% of buyers would think about purchasing an EV as opposed to 69% who would think about purchasing an ICE car. This desire for EVs is fueled by a variety of factors, with prospective buyers citing the environmental impact (67 percent), lower total cost of ownership (26 percent), and less engine noise (26 percent) as the main advantages of driving an EV, mentions McKinsey&Company in its report.
Image McKinsey Report
EV Sales in the First Half of 2024
India registered 8,42,396 EVs in the first half of 2024 as of July 8, 2024, up 16% from 7,23,492 EVs in the same period in 2023 (for a total of 15,29,947 EVs registered in 2023). This increased trend not only demonstrates the country’s dedication to environmentally friendly transportation, but it also shows how confident and prepared the Indian market is for greener options. As of June 06, 2024, India has 16,344 public charging stations, including 27,471 public charging points, and 10,756 fast charging points, promoting EV adoption.
New EV Manufacturing Policy in India
In order to encourage the production of e-vehicles using the newest technology in India, the Indian government authorized a plan in March 2024 to market the nation as a manufacturing location. The goal of the policy is to get reputable international EV manufacturers to invest in the e-vehicle market. By encouraging healthy competition among EV players, this will strengthen the EV ecosystem, give Indian consumers access to the newest technology, and support the Make in India initiative. This will result in high volume production, economies of scale, lower production costs, fewer imports of crude oil, a smaller trade deficit, less air pollution, especially in urban areas, and positive health and environmental effects.
Electric Mobility Promotion Scheme 2024
With an investment of Rs. 500 crore, the Indian government has announced the Mobility Promotion Scheme 2024 (EMPS 2024), which would ran for four months, from April 1, 2024, to July 31, 2024. In order to further stimulate green mobility and the growth of the nation’s electric vehicle (EV) manufacturing eco-system, the program is designed to accelerate the adoption of electric two-wheelers (e-2W) and electric three-wheelers (including registered e-rickshaws, e-carts, and L5). The program primarily apply to e-2W and e-3Ws registered for business use, with a stronger focus on offering accessible and environmentally friendly public transit options for the general public. Furthermore, registered e-2W owned by corporations or personally will also qualify for the program. Only vehicles with cutting-edge technology will be eligible for the incentives.
The GST rate for electric cars and charging stations has been lowered to 5%. Battery-operated vehicles will receive green license plates and be exempt from permission procedures, according to a statement released by the Ministry of Road Transport & Highways (MoRTH). In order to lower the initial cost of EVs, MoRTH advised states to waive the road tax on EVs in a notification.
Cost of EV Batteries
The market expansion for EV batteries, materials, BMS, and BESS is influenced by pricing and technological considerations. The cost of EV batteries has decreased by 85% in India over the past ten years, which has accelerated the uptake of EVs. The cost of battery packs, for example, decreased by 14% from $1.93 KWh in 2022 to $1.67 KWh in 2023. EVs in India have primarily employed lithium-ion batteries (LiB); however, because of fire issues involving LiB, the industry is searching for other technologies and solutions, such as nickel and cobalt chemistries. According to industry journals, the demand for EV lithium batteries in India is expected to increase from 4GWh in 2023 to 139GWh by 2035.
Lithium Iron Phosphate (LFP) Cathode Chemistries
The share of lithium iron phosphate (LFP) cathode chemistries has increased during the last ten years. Chinese OEM choices are the primary driver of this development. Approximately 95% of the LFP batteries used in electric LDVs were used in Chinese-made automobiles, with 50% of the demand coming from BYD alone. 15% came from Tesla, and the company’s usage of LFP batteries rose from 20% in 2021 to 30% in 2022. Approximately 85 percent of Tesla’s LFP-powered vehicles were made in China, with the remaining cells being imported from China and made in the US.
Downside of LFP
In total, only around 3% of electric cars with LFP batteries were manufactured in the United States in 2022. LFP batteries contrast with other chemistries in their use of iron and phosphorus rather than the nickel, manganese and cobalt found in NCA and NMC batteries. The downside of LFP is that the energy density tends to be lower than that of NMC. LFP batteries also contain phosphorus, which is used in food production. If all batteries today were LFP, they would account for nearly 1% of current agricultural phosphorus use by mass, suggesting that conflicting demands for phosphorus may arise in the future as battery demand increases.
Sodium-ion (Na-ion) Li-ion Batteries
Sodium-ion (Na-ion) Li-ion batteries have been on the rise. This battery chemistry offers the combined benefits of not requiring any essential minerals at all and using less expensive materials than Li-ion, which results in cheaper batteries. As of right now, it is the only practical chemical devoid of lithium. An LFP battery is expected to cost 30% more than the Na-ion battery created by China’s CATL. On the other hand, the energy density of Li-ion batteries is 120–260 Wh/kg, whereas that of Na-ion batteries is 75–160 Wh/kg. Because of this, Na-ion may be useful for stationary storage or for urban vehicles with shorter range, but it may be more difficult to implement in areas where customers value maximum range autonomy or where charging is less convenient.
Additionally, battery prices vary by area, with the rest of Asia Pacific having the highest prices and China typically having the lowest. The fact that about 80% of cathodes and about 65% of battery cells are produced in China contributes to this price difference.
https://www.iea.org/reports/global-ev-outlook-2023/trends-in-batteries
