Indians unwilling to pay premium for electric cars

Chennai:  Indian car buyers are not willing to pay premium/higher price for a battery powered car than the conventional car unlike their counterparts in many other markets, a global survey conducted by Deloitte Touche Tohmatsu Ltd says.

“As per our survey Indians are unwilling to pay a premium for a clean technology, as is found to be the case in most markets. A third of Indian customers expect the purchase of the electric car around Rs.400,000 and another third willing to go up to Rs.700,000 corresponding to the prices they would pay for their conventional car,” Kumar Kandaswami, senior director, Deloitte Touche Tohmatsu India told reporters.

Releasing the survey titled ‘Gaining traction: Will consumers ride the electric vehicle wave’ done across 17 countries including India, China, Japan, Europe and USA covering 13,500 respondents, the electric cars have the potential to gain customer attention in the context of increasing fuel prices and their desire to go green.

According to the survey, electric cars are considered within the reach of the middle class in most other markets, the manufacturers selling such cars in India have to target the upper middle class segment.

The Deloitte report states electric cars offer both an opportunity and a threat to the existing car makers.

While the battery powered cars offer new business opportunity there is more likelihood of large parts of the existing value chain going waste.

According to the survey, the barriers that manufacturers have to cross are reducing the battery charge time while increasing the vehicle’s travel range, fuel prices and the vehicle cost.

“Forty nine percent of the Indian respondents require the charging time to be two hours or less. On the range that a car can travel per charge respondents want it to be around 320 km though they drive for less than 80 km per day,” Kandaswami said.

Citing the survey, he said a little over 70 percent of the respondent said they would consider an electric car if the petrol price crosses Rs.85 per litre.

Conversely, 74 percent of the respondents are less likely to consider buying an electric car if the conventional cars were to deliver a mileage of 32 km per litre.

“On the basis of the cost, range and charging time realities of the electric vehicles (EV) available in the market, we estimate EVs to be less than five percent of the total passenger vehicles sold in India by 2020,” Kandaswami said.

However this can change dramatically if the car makers are able o achieve technology and price breakthroughs, he added.

He said if an efficient multi-modal public transport system emerges in India, then there is a possibility of demand spurt for battery powered vehicles as people will use the cars to bus or railway station from their home and use the public transport. (IANS)