Commercial electric 3 wheeled mobility solutions have emerged as partners in India’s ecommerce and last-mile delivery services. As on date the electrification has grown multiple fold from approx. 5% last year to 25% this year (YTD) expected to cross 30% by end of this fiscal year (FY24).
In recent times, both ecommerce and quick delivery services like 1o-minute home delivery have gained traction, propelling the need for clean mobility solutions. They not only cater to the business requirements but are also aligned with sustainable development.
Favourable policies such as PLI, FAME and initiatives like Make in India and Atmanirbhar Bharat have acted as catalysts, increasing domestic manufacturing and making EVs cost efficient to meet Indian requirements and conditions, resulting in deeper E3Ws penetration across India. The affordability of electric three wheelers (E3Ws), ease of ownership, convenience and financial gains with cost savings on fuels, resulted in their higher uptake.
Ecommerce, last-mile delivery, cost-benefits and conscious customers key growth drivers of E3Ws
The demand for electric 3 wheelers till last year was majorly in ecommerce. However, from this year, many new captive applications and driver-owner segments have started adopting 3-wheeler electric cargo for the last mile transportation.
The shift towards electric mobility is largely because the operating costs of EVs is much lower than diesel or CNG vehicles, leading to substantial savings for operators.
Operating economics of EV including Electricity and Service cost is close of Rs 1.3 / Km (Fuel + Service) compared to Rs 5 /Km (Fuel +Service) in alternate fuel diesel vehicle, promising a net saving of Rs 3-4 / Km.
In addition, considering the environmental challenges, brands themselves are realizing that their consumers are becoming more environmentally conscious and are attracted towards companies that prioritize sustainability and ESG goals!
Eliminating existing bottlenecks to maintain growth momentum:
It must be noted that a major factor that worked in favour of higher penetration of L5 electric 3Ws is technology which today, can easily compete with most of the use cases which were earlier only possible by ICE vehicles. It is further supported by incentives on domestic manufacturing, government’s support through policies and demand side incentives, charging Infrastructure presence, and ease of vehicle finance through new age fintech companies.
To make sure these EVs continue to come at an affordable price, extension, or continuation of schemes like PLI and FAME is necessary. Focus must be also given on incentivizing businesses which switch to EVs to promote sustainability and accelerate transition to the electric future of mobility.
Meanwhile, increase in EV adoption has resulted in the creation of new job opportunities, and according to the Economic Survey, the EV industry will create five crore direct and indirect jobs by 2030. As EV makers ramp up production to meet growing demands, there is a huge need for talent across various aspects of EV design such as battery engineering, power electronics, energy storage systems, electric vehicle designs, software development, advanced technologies such as AI, ML, and others. The EV industry will require talented professionals who carry the required experience along with specific skills and knowledge in this specialized field.
This makes it important for the industry to prepare a workforce with necessary knowledge, skills and training to bridge the talent gaps and meet workplace demands across all levels. These should not be limited to engineering and design roles, but also to line manufacturing and shop-floor workers, as well as service technicians and workshop mechanics. There is also a need to build green talent to fill green jobs in various allied fields such as solar, renewable energies, sustainable practices, and others.
Moreover, policy makers, industry partners, and educational institutions must join hands to support training, promote research and development and knowledge exchange to stay updated and learn the latest technological advancements, develop deep technical expertise to design and develop innovative EV solutions.
The growing demand for electric three-wheelers in India is definitely a promising sign and is a reflection of seriousness and commitment towards achieving sustainable mobility. As electrification of fleets and e-commerce services continue to grow, these sustainable and efficient solutions will continue to shape the future of commercial mobility in the country.
