Globally, the mobility ecosystem is undergoing a transformational, technological and economic shift which is fundamentally changing the way people and goods are being moved. The automotive sector coupled with transport are experiencing heavy disruptions, with new markets originating, the existing ones showing converging dynamics and others witnessing a declining trend which shall end up into vanishing existence. Many new age start-ups and new market entrants are challenging the incumbents who are focused on leveraging their experience and develop a sustainable market model. The mobility transformation is majorly driven by three main trends:
(i) Electrification of vehicles and availability of alternative power trains
(ii) Connected and autonomous vehicles
(iii) Mobility-as-a-Service (MaaS)
China is expected to lead the global markets for AVs and has the potential to be the largest one by 2040. It is likely that the share of AVs will contribute approximately 70% of the passenger-kilometers travelled in 2040 which can attract a revenue of $1.1 trillion from mobility services and $0.9 trillion from sales of autonomous vehicles by that year..
To understand that in terms of number of vehicles will make up just over 40% of the new vehicle sales in 2040, and nearly 12% of vehicle installed base.
The challenge to make EVs profitable remains to be addressed globally. Although, OEMs along the globe are working hard to bring the cost gap of EVs and ICE down but it will take some time to reach at par. Currently a gap of nearly $ 12000 exists between EVs and ICE which is massive for country like India.
Battery pack remains the biggest cost driver for EVs around the globe for which the OEMs are focused upon native EV design and cooperation among each other to bring down the costs. There is an ardent need to scale up battery manufacturing so that EVs could become a sustainable option in long run.
The demand for small format e-vehicles in India is witnessing a north-bound trend and is likely to drive the EV ecosystem in the country. It is estimated that by 2030 the 2W & 3W fleet size could reach or cross 9 Million on cumulative basis. Further the push for augmenting the infrastructure to help lead the EVs penetration is quintessential in the country.
The EV charging stations sanctioned by Ministry of Heavy Industries, GoI stands at 520 of which 479 have been installed till July 2022. The spread of 479 involves 398 installed in different states and 81 charging stations on highways as indicated in Exhibit 5.
India is not completely starting from scratch in terms of sustainable transportation initiatives. Both at the concurrent Government levels steps have been taken to bring initial investments in new transportation modes and technologies.
a. Electric Vehicles: Electric buses are already plying in various Tier I and Tier II cities in India since last couple of years. Delhi has recently got a dedicated EV bus fleet to meet the demand of local public transport in the region.
b. Shared Mobility: Like e-mobility the shared mobility demand for shared mobility is going to rise as well in the country. This shall at large be driven by three use cases like e-commerce/small format, food delivery & grocery delivery. The growth for these use case shall exceed 40%-50% if the penetration of EVs are being supported by supportive ecosystem.
c. Micromobility: In the country in cities like Delhi, Bangalore & Ahmedabad are offering e-scooters and docked bicycles. Delhi metro also offers e-bicycles on rentals and has seen shared mobility penetration in the city.
d. Mass Transit: There has been significant investment in metro projects and mass rapid transit systems in the country. All major cities are having either the running metro projects or are having them under construction.
India is a vast country and with growing population the nature of public transport, goods movement and other mobility shall have to adapt accordingly. For this the identified pillars are depicted as below:
a. Public Transport: A multi-modal, integrated, and robust public transport system is central to sustainable mobility systems. Governments at concurrent levels should continue to invest in these systems, with the goal of eventually shifting to a fully electric fleet. Advancing public transport ridership has allowed urban areas across the globe to overcome many less-than-efficient mobility and societal outcomes.
b. Electrification: GOI has already enabled incentives coupled with State level incentives on offer for greater adoption of EVs. With this intent the country witnessed nearly 0.55 Million of EVs sold within a period extending from January to August 2022 which is anticipated to reach beyond 0.8 Million by December 2022. This shall be leading to almost 65% yoy growth for the same period in 2021.
c. Shared Mobility: Cities in India can move commuters more efficiently by reducing the reliance on personal vehicles and using shared mobility solutions to increase riders per vehicle. The market expansion of ride-hailing players like OLA & Uber has proven that shared mobility as a business model works well within a lightly regulated market, while improving asset utilization.
d. Soft Transport Modes: Micromobility solutions can increase the options for urban residents and increase usage of public transport by addressing first-mile and last-mile connection challenges. State governments should continue to deploy such alternatives as bike-sharing and e-scooters in major cities apart from Delhi, Mumbai, Bengaluru and Chennai.
e. Future Communities: Governments can reduce the need for transportation through sustainable urban designs that use new living and community concepts to make vital goods and services available within walking distance from residential areas.
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