Concept Note on International Congress on EV Market
Global Automotive industry is witnessing major structural changes as globalization has resulted in new business alliances and industry–academic–government partnerships. World is witnessing an unambiguous paradigm shift from Internal Combustion Engine based automotive to alternate electric based fuel system and this is changing the global mobility landscape fastidiously.
Technology is major contributor to these structural changes with some of these technologies are being futuristic while others are nearing commercial production. On the top of it, the convergence of disruptive technology-driven trends are transforming the automotive industry. Technology can be classified into two major categories: Automotive feature related and Fuel or engine related technologies.
In the Automotive feature category technologies like Self-drive cars, Smart Dashboards, Autonomous features like active parking assist and advanced cruise control that almost allows the car to drive itself, Gesture control, Black box car tracking (it helps in pre-empting and diagnosing breakdowns more quickly) and Automated Manual Transmission (AMT) are some of the emerging technologies that will be affordable to the end-user.
Related to fuel or engine technology world has witnessed tremendous growth in Alternate Fuel Vehicles namely Fuel Cell Electric Vehicles (FCEVs), Pure play Electric Vehicles (BEVs), Hybrid Electric Vehicle (HEVs), Plug-in Hybrid Electric Vehicles (PHEVs) and Natural Gas Vehicles (NGV).
Electric Vehicle Technology
It is now an established fact that Electric Vehicle will disrupt the automotive industry in the next 10 years. According to Goldman Sachs Low Carbon Economy report, Global Electric Vehicle Initiative seeks to facilitate the global deployment of at least 20 million passenger car EVs, including plug-in hybrid and fuel cell electric vehicles, by 2020.
EVs – both hybrid and pure electric cars – will make up more than one-quarter of the global car market within just 10 years, with their numbers growing from approximate 1 million today to around 25 million in 2025.
Electric Vehicles (EV) category with in the Alternate Fuel Vehicles which includes FCEV, BEV, PHEV’s and HEV has seen momentous traction in the automotive industry. A battery electric vehicle (BEV) is a vehicle that is powered entirely on electric energy consisting of typically a large electric motor and a large battery module.
Based on the type of transmission; the use of a clutch, gearbox, differential, and fixed gearing; and the number of battery module and motors there are many variations on the BEV design. Plug-In Electric Vehicle, Extended Range Electric Vehicle and Battery Electric Vehicle Powertrain System integrates powertrain components, internal combustion engine and transmission, with new electric components – electric motor, power electronics and high voltage energy storage, such as a battery.
Electric Vehicle Market: The disruptor to ride on
Despite all the challenges faced by EV manufacturers viz. high capital cost of batteries, charging time compared to refuelling diesel/petrol and Distance range anxiety, the EV market Ecosystem has adapted to counter these challenges.
In 2015 Norway had the highest market share of 23.30 percent in the EV market followed by Netherlands (9.70 percent), Sweden (2.40 percent) and Denmark (2.20 percent).
Table 1: Market share of countries in Global Electric Vehicles Sales in 2015 – BEVs and PHEVs
According to Organization of Petroleum Exporting Countries (OPEC) report on World Oil Outlook 2017, the passenger vehicles segment within EV category will witness a sales growth (CAGR) of 17 percent during 2017-2030 which is faster than vehicles based on conventional fuels (4.17 percent growth) and this does not even include the PHEV passenger vehicles.
By 2030, passenger EV’s (excluding PHEVs) will occupy 17.10 percent market share out of total passenger vehicles sales. India and China had a market share of 0.10 percent and 1 percent respectively in 2016 but this situation is changing very fast in both these Asian giant economies. According to ANS MarketPro forecast, 2017-2025, based on Policy Intervention scenario China will witness a momentous growth in EV sales (CAGR) of 15 percent during 2017-2025.
EV Market Ecosystem
Broadly the EV market ecosystem includes EV Vehicle manufacturers, Component suppliers, Power Utilities, Mobility providers, Government Policy and Regulatory Institutions and End-User.
On micro-level EV market ecosystem consists of battery manufacturers, Charging Infrastructure firms, Charging maintenance and operation service firms, Power Utilities, Testing & Safety Standard institutions, Designers & Technologists, Battery Recycling firms, Automotive related Information Technology companies, Automotive Engineers, Dealers & Distributors, Mobility players like vehicle aggregators and Automotive Financing institutions.
Regulatory Push for EV market in India
Government of India launched the National Electric Mobility Mission Plan (NEMMP) 2020 in 2013 with the aim to achieve national fuel security by promoting hybrid and electric vehicles in the country. The target set by the plan is to achieve 6-7 million sales of hybrid and electric vehicles year-on-year from 2020 onwards.
Government aims to provide fiscal and monetary incentives to kick start this nascent technology. With the support from the Government, the cumulative sale is expected to reach 15-16 Million by 2020 according to NEMMP 2020.
With the announcement of the Phase I of Faster Adoption and Manufacturing Electric Vehicles (FAME) Scheme in India on April 1, 2015 and latest announcement of phase II of the FAME Scheme starting March 31, 2018, under the aegis of Ministry of Heavy Industries & Public Services, will make electric vehicle part of everyday life of consumers by 2030.
The EV market is poised to grow (CAGR) at 18 percent during 2017-2025 according to ANS MArketPro Research Report entitled “India Electric Vehicle Market, 2017-2025: Analytics, Strategy, Investment and Competition” under the “Policy Intervention scenario”.
The DHI is provide viability gap funding through subvention scheme to support the extra cost of acquisition and operation of these vehicles by state governments or designated bodies. The thrust for the Government through this scheme will be to allow hybrid and electric vehicles to become the first choice for the purchasers so that these vehicles can replace the conventional vehicles and thus reduce liquid fuel consumption in the country from the automotive sector.
It is envisaged that early market creation through demand incentive, in-house technology development and domestic production will help industry reach economies of scale in the long run.
In continuation, for development of EV market in India DHI on October 11, 2017, constituted a Committee to finalize the protocol for charging infrastructure for different combination of voltage and speed of charging.
Subsequently, DHI notified the “Standardization of Protocol for EV Charging Infrastructure Bharat Public EV Charger Specifications” order on November 21, 2017. The Committee has come out with recommendations in the form of specifications for AC and DC chargers namely Bharat EV Charger AC-001 and Bharat EV Charger DC-001.
These specifications are intended to cater to the immediate need of existing and announced electric Two Wheelers, Electric Three Wheelers and Passenger Cars having battery voltage less than 100 Volts.
Investment Opportunities in EV sector
The growth of EVs will lead to profound changes across the automotive value chain, including technology, manufacturing systems, ownership models, distribution and aftermarket support.
- Lithium Ion Battery Manufacturing
Global market for Lithium Ion Batteries for EVs was estimated at US$ 2.01 billion in 2000 and this market is projected to reach US$ 10 billion industry in 2020 representing a CAGR of 22 percent during this time period according to Citi Bank Estimates.
A closer look at the market capitalization of key Lithium Ion battery manufacturers for automobiles Panasonic and BYD with US$ 22.70 billion and US$ 19.40 billion respectively at the end of 2016 showcases the fact that the future market indices will be driven by these conglomerates.
- Manufacturing of EV parts such as motors, chargers, controllers, automotive semiconductors and microprocessors
The market for electric motors for electric vehicles is expected to reach US$ 25 billion by the end of 2025 driven by the growing global activity in the electric vehicle industry. Majority of the motors, used in electric cars, with AC electric motor is more popular than DC electric motor, are:
- Series wound DC motor,
- Permanent magnet motor,
- 3-phase AC motor
The key players in the market are:
- Allied Motion Technologies
- Siemens AG
- Investment in Vehicle Charging Infrastructure:
The vehicle charging infrastructure encompasses Charging Station manufactures, charging station installation and maintenance services providers, and charging station operators. Network of fast DC chargers on the main traffic arteries and national highways present substantial investment opportunities. Further, opportunities in innovative charging practices like battery swapping will present new and exciting business models for entrepreneurs in this space.
- CVs – Buses, Light Commercial Vehicles and Small Commercial Vehicles:
Apart from Passenger Vehicle manufacturing, Small Commercial Vehicles (SCV) within the Light Commercial Vehicle category and E-buses for passenger transportation will provide investment opportunity to showcase a plausible deployment of EVs globally.
The key drivers for growth of commercial electric vehicles are:
- Total cost of ownership (TCO): Based on this critical factor these trucks are at par with diesels and alternative powertrains
- Cost competitive electric vehicle (EV) technology and infrastructure
- Stricter regulatory environment
- Recycling and Reuse of Batteries
Batteries are expensive and have a relatively short life span therefore they are needed to be recycled and reused. Working on ways to profit from a used car battery bonanza will present new investment frontiers.
- Automotive related Information Technology
EV IT system features two kinds of functions, those used on-board and those used remotely via a computer or mobile telephone. Development of EV market will provide investment opportunities in software related to functioning of EVs.
- EV – Engineer and Technicians Training Institutes:
EV market will also provide investment opportunities for Training Institutes, which will help skill engineers and technicians to build next generation EV’s.
EV market establishment, especially in its nascent stage, will need effective and flexible planning & coordination among government agencies, EV industry players and policy & regulatory authorities and industry hand holding till the market takes-off and become commercially self-sustainable.
The key stakeholders in the EV market ecosystem viz. Vehicle manufacturers, Component suppliers, Power Utilities, Mobility providers, Government Policy and Regulatory Institutions et al need to come on same platform to make it a success.
Our mission is to bring key stakeholders in the EV market ecosystem on one platform to sketch a detailed implementable strategic plan for effective and efficient EV market development in short to long-term horizon and to facilitate investments and co-ordination among key stakeholders which is sine qua non for development of sustainable and competitive EV market.
As part of the mission we are conducting “International Congress on Electric Vehicles Market” in 2018.
The main themes of the Congress include:
- EV Market: How can we make it Happen – The Key Enablers
- Shifting Automobile Technology Paradigms: HEVs, PHEVs, FCEVs, REEVs and BEV
- Economic Viability of Commercial Electric Vehicles
- Why Policy and Regulations hold the key?
- Information Technology for Connected e-Mobility
- Supply Chain Management and EV Value Chain
- Skill Development for Sustainable EV market Ecosystem