E two wheeler sales
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NITI Aayog report shows chances of 100% E two-wheeler sales by 2027.

In the worst-case scenario, sales of electric two-wheelers will reach 7.8 lakh units in FY 2031, and in the best-case scenario, it will reach 2.5 crore units in FY 2031.

NITI Aayog and TIFAC launched a report titled โ€˜Forecasting Penetration of Electric Two-Wheelers in India.โ€™ Together NITI Aayog and TIFAC developed eight scenarios to analyse the future penetration of electric two-wheelers in the country. The report shows E two wheeler sales in eight different scenarios.

In an optimistic scenario, the report forecasts 100% penetration of electric two-wheelers in the Indian market by FY 2026โ€“27.

In another scenario, which is technology driven and where current incentives( FAME-II) are withdrawn by 2024, the report predicts 72% penetration by 2031.

The eight scenarios are as follows:

  1. Challenged Diffusion: In this scenario, the incentives are expected to end after FY 2024, and battery cost is expected to reduce by 2% CAGR. It is also expected that there will be no performance improvement because of all the technological progress. In this scenario, the projected sale of electric two-wheelers shows that the maximum sale will be 9.85 lakh units in FY 2024, and it will reach 7.8 lakh units in FY 2031 after a slump following the withdrawal of demand incentives.
  2. Performance Driven: Under this scenario, the demand incentive is withdrawn after FY 2024, the battery cost reduction annually is at 2%, and the only positive influence is improvement in the range and power of the electric two-wheelers by 5% annually during the period the FY 2024 to FY 2027. In this scenario, a sale of 12.70 lakh units of electric two-wheelers will occur in FY 2024, reaching 17.87 lakh units in FY 2031.
  3. Low Battery Cost: Under this scenario, the battery cost is assumed to reduce annually at a rate of 8%. However, the demand incentives are withdrawn after FY 2024, and the performance level of the electric two-wheelers is assumed to remain the same. In this scenario, the sales volume of electric two-wheelers reaches a maximum of 15.33 lakh units in FY 2024 and 27.62 lakh units in FY 2031.
  4. Technology Driven: Under this scenario, the demand incentive is assumed to be withdrawn after FY 2024, and battery cost is supposed to reduce by 8% annually. The range and power of electric two-wheelers are assumed to improve by 5% annually from FY 2024 to FY 2026 and by 10% in FY 2027 due to technological progress. In this, the sale volume of electric two-wheelers is expected to reach 21.02 lakh units in FY 2024 and 179.69 lakh units in FY 2031.
  5. Incentive Driven: In this scenario, the demand incentive is assumed to continue till FY 2031. The range and power of the electric two-wheelers are assumed to remain at the present level, and battery cost reduces by 2% annually. Under this scenario, the sale is expected to reach only 55 lakh units in FY 2031.
  6. Battery Cost Challenged: Under this scenario, the only major obstacle to larger penetration of electric mobility is the cost of the battery, which is assumed to reduce at a CAGR of 2% only. Demand incentive is present during the period FY 2024 to FY 2031. Range and power improve by 5% annually from FY 2024 to FY 2027. In this, the maximum sale of electric two-wheelers in FY 2024 will be 220.15 lakh units. With increased vehicle production levels, an annual sale of 251.17 lakh units is achieved in FY 2031.
  7. Same Performance: Under this scenario, all other favorable conditions are assumed to exist, except improvement in the range and power of the vehicles, which are assumed to remain at the present level. Thus, the demand incentive will remain in force, and the battery cost will reduce by 8% annually. In this scenario, the penetration level will reach 98.11% in FY 2029, and the sale will reach 220.15 lakh units in FY 2031.
  8. Optimistic: Under this scenario, all factors that have a positive influence on the adoption of electric two-wheelers are present. The demand incentive is assumed to be in place throughout the period, and the battery cost is assumed to reduce by 8% annually. It is also assumed in addition, that the range and power of the vehicle will improve by 5% from FY 2024 to FY 2026 and by 10% in FY 2027. The penetration of electric two-wheelers will reach 100% in FY 2028 and e two wheeler sales will reach 251.17 lakh units in FY 2031.

You can read the full report by clicking here.

Also Read: Haryana approves EV policy 2022.

2 thoughts on “NITI Aayog report shows chances of 100% E two-wheeler sales by 2027”

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