Electric vehicles ride high in Motown amid chip blues

A global shortage of semiconductor chips continues to hamper passenger vehicle production in India and elsewhere with automakers losing billions of dollars in earnings, but there is one silver lining in Indian Motown — electric vehicles (EVs) are gaining traction.

At a time when car buyers in the country have to wait for 2-8 months to get possession of their dream cars, many are turning to EVs from manufacturers such as

and MG Motors.

A positive outreach by manufacturers, improved charging infrastructure, and price parity with conventional vehicles on the back of government incentives and falling battery prices are driving the demand, experts said.

“We need to look at fundamentals,” said Rajeev Chaba, MD of MG Motor. “EV trend is a global and local trend due to more environmental awareness and ‘cost of ownership’ reasons. In India, we believe that customers are ready and are waiting for good solutions, and the EV trend would grow significantly.


Last month, the company received more than 700 bookings for its ZS EV, a five-seater electric SUV.

The country’s most-affordable electric SUV, the Tata Nexon EV had clocked 1,022 unit sales in August — the first time an electric car in the personal mobility segment posted four-digit sales in a month.

“EVs are fast gaining popularity on the back of rising comfort of customers, as the barriers to adoption are being overcome and due to growing preference for environmentally friendly solutions,” said Shailesh Chandra, president, passenger vehicle business unit, at Tata Motors. “Increasing support from the central and state governments, providing subsidies and a conducive environment for EVs to grow, inspires us to expand our EV offerings.”

Tata Motors launched EV version of the Tigor sedan last month.

Overall EV sales clocked 28,919 units last month, a growth of over 10% over July. EVs accounted for 2% of all vehicles sold for the first time last month, doubling from 1% in January, according to data compiled by policy research institution Centre for Energy Finance at Council on Energy, Environment and Water at Centre for Energy Finance (CEEW-CEF).

This is likely to improve this month as more than 3,000 EVs were retailed in the first two days alone.

Experts said subsidies will increase adoption, encourage R&D and innovation, and help in making EVs reach about 10% of the overall two-wheeler market in five years.

“Multiple EV sector policies such as the FAME II scheme and individual state policies provide EV buyers with purchase incentives,” said Meghna Nair, research analyst at CEEW-CEF.

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