Future prospects for the Indian electric two-wheeler industry and synthetic fuels (eFuel).
Against the backdrop of stricter global environmental regulations, the drive to decarbonise and go carbon neutral in major countries and regions around the world is accelerating, with BEV sales becoming mandatory by 2035. If forecasts are made in line with various regulations, the global market for electric passenger cars (BEVs, PHEVs and FCEVs) is expected to exceed 50 million units by 2035. However, at this stage, the electric vehicle supply capacity of existing car manufacturers is barely on a par with Tesla, and Chinese manufacturers looking to expand outside the country will be added as new competitors. Furthermore, the number of people who can afford electric vehicles remains limited due to the lack of factors to reduce vehicle prices, and although the market has been expanding rapidly, it will be difficult to maintain the momentum of the past and competition for market share will intensify in the future.
Last year (2022), global electric vehicle (BEV/PHEV/FCEV) sales exceeded 10 million units. While global new vehicle sales stagnated at the level of more than 80 million units, they were 60% higher than the previous year and three times higher than the year before. Global market share exceeded 13%.
Generous purchase subsidies in various countries are seen as a driver of this rapid growth, while product diversification and individual optimisation, which has also progressed, have driven sales growth. As a result, shades of grey are becoming increasingly evident by region and by product/brand. As a result, shades of grey are becoming increasingly evident by region and by product/brand.
Sales of electric two-wheelers in India surged from 154 000 units in 2021 to 624 000 units in 2022, almost four times the previous year’s figure, and monthly sales continued to exceed 64 000 units from October 2022 to the most recent February 2023. However, various problems have arisen, including the outbreak of fire accidents involving electric two-wheelers, irregularities in the provisions for domestic production of parts, which is a condition for the provision of subsidies, and the proliferation of new manufacturers based on Chinese products. Against this backdrop, the Indian Government has added new items to the safety standards for battery packs/cells/BMS to improve safety, and is shifting its focus from promoting sales of subsidised electric two-wheelers to encouraging the localisation of electric components. The central government plans not to continue the FAME policy of subsidising the purchase of electric two-wheelers after April 2024, and there are reports that it is also considering restrictions on imports of electronic components and other products from China, which could slow the rapid growth in demand for electric two-wheelers.
On the other hand, electric two-wheelers may continue to enjoy strong demand even after the end of subsidies, if users appreciate their quality, safety and cost performance, in terms of excellent maintenance and running costs and advanced digital functions. Localisation and price reduction of key electric components such as drive motors, controllers and battery packs, while ensuring quality, is an urgent issue for the Indian electric motorcycle industry. In addition to government policies, the business strategies of existing major OEMs, key electric two-wheeler manufacturers and suppliers will themselves influence the future direction of the electric two-wheeler industry.
Electric vehicles (BEVs) are becoming increasingly popular worldwide with the aim of achieving a carbon-neutral society by 2050-2060. Some countries and regions have adopted policies to ban the sale of new engine vehicles in the future. However, there are many regions of the world where electrification will continue to be difficult due to economic conditions and charging infrastructure problems. Even if all new car sales were to be zero-emission vehicles (ZEVs), more than one billion vehicles owned and sold up to that point would still be left behind from decarbonisation. In other words, to achieve a carbon-neutral society, it is essential to provide decarbonisation technologies for the vehicles already sold in the fleet. Synthetic fuels (eFuel), fuels derived from renewable energy sources, are the most promising solution to decarbonise non-ZEVs.
eFuel is also promising in terms of the effective use of renewable energy (renewable energy). Even in regions where electrification of mobility is progressing, not all electricity is provided by renewable energy. In fact, the more such regions have a shortage of renewable energy. Renewable energy is more abundant in remote parts of the world, and needs to be brought from there. Electricity cannot be stored and the costs of transmission lines are astronomical. This is exactly the idea behind Porsche’s project in Chile, South America.