No market for alternate powertrain vehicles in India

All the hype over alternate fuel powertrains remains just that — hype.

Alternate fuel powertrains accounted for just 2% of global passenger vehicle sales last year. Indeed, going by JD Power Asia Pacific, only 9.5 lakh vehicles sold globally in 2010 were run on alternate fuel powertrains.

This means these vehicles were not using fossil fuels and were either plug-in hybrids, battery electric vehicles, or hydrogen fuel cell vehicles.

The total global vehicle sales last year was 45 million units.

No wonder that the future of such vehicles in the country remains rather bleak.

“In India, the picture is more acute. Unless the government brings in subsidies which bring prices of these vehicles on par with those of combustion engines, it’s not a very rosy picture,” Mohit Arora, executive director, JD Power Asia Pacific, told DNA.

He said even by 2020, sales of alternate powertrain vehicles would be just 7.3% of overall vehicle sales. As per JD Power’s ‘Drive Green 2020: More Hope than Reality?’ report, by 2020, only three Indian manufacturers will even have a presence in the global alternate fuel powertrain market of 3.8 million vehicles. Tata Motors is expected to have 0.4% share, Mahindra and Mahindra 0.3% and Maruti Suzuki India 0.2% share of the global alternate fuel powertrain market.

Globally, such vehicles include Chevy Volt, Nissan Leaf, Toyota Prius, Honda Insight, Honda CRZ and Byd e6. In India, only the Prius is being sold as a completely built unit (which attracts import duty of over 100%) and is therefore quite expensive.

In the budget for 2010-11, the finance minister announced a number of sops for hybrid and other alternate fuel powertrains in India to encourage indigenous development of such technologies. But many in the auto industry wonder if this long list of concessions will actually spur anyone to develop alternate powertrains commercially.

Maruti Suzuki India chairman RC Bhargava said though parent Suzuki Motor and Maruti have been working jointly to develop hybrid technology, it is still way off any sort of commercial application. Apart from Maruti, only a handful of Indian companies have even begun work on developing hybrids. Tata Motors and Ashok Leyland have individually developed hybrid buses; Mahindra & Mahindra has developed hybrid Scorpio and now also owns electric carmaker Reva; TVS Motor Company has also developed a hybrid two-wheeler - but most of these products are still not commercially viable.

In the green report, JD Power has observed that rather than rushing to commercialise battery electric vehicles, the industry might be better served to pursue continued fuel economy improvements in ICEs (internal combustion engines) and the mass production of hybrid EVs.

“Hybrid EVs have many benefits: they are a proven technology and have high consumer awareness; cost substantially less to produce than BEVs; have excellent driving range, very low exhaust emissions, and offer excellent fuel economy; and require no new infrastructure to support them,” states the report.

The report concludes by noting that as the world advances toward electric vehicles, it must also be recognised that the “gasoline ICE will continue to play a central role, especially during the next 10-15 years”.