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Maruti Suzuki has made a serious statement about the price viability of electric vehicles. They say a petrol car that retails for Rs 5 lakh today, may cost as much as Rs 12 lakh in the electric version. They also said that lack of charging stations makes moving to the electrics difficult.
According to the Times Of India Business, R C Bhargava, Chairman, Maruti Suzuki, said that there are a series of challenges that come in between the effort the government is putting in to movement towards electric mobility, and the biggest one is pricing.
He said, and asked, "Just like there are cost escalation concerns when it come to migration of diesel engines to BS-VI emission norms, there are similar concerns over affordability with regards to electric vehicles. The price of electrifying a small car could go beyond the reach of small car owners. A Rs 5 lakh petrol car may become a Rs 9 lakh in the electric version. Would you buy it then?"
Kenichi Ayukawa, Managing Director, Maruti Suzuki said that the electric version of a small car may cost up to Rs 12 lakh, considering the present regulatory regime and the incentives the government offers.
Goods and Service Tax on electric vehicles stands at 12 per cent against the 28 per cent set for small petrol cars. However the government has not offered a subsidy for private electric vehicles. Under the FAME II scheme, the subsidy and the incentives are meant for commercial vehicles and hence they are giving it to taxis.
Mr. Bhargava also said the an assurance for charging infrastructure is critical for a mass movement towards electric vehicles. He also added that this infrastructure was difficult to set up. "A large portion of car owners do not park vehicles at home, but outside. Where will they charge vehicles if they are electric? Where is the infrastructure?", he stated.
Although Maruti is setting up a factory for Lithium-ion batteries in Gujarat with Toyota, Mr. Bhargava feels that the future of clean mobility is still undecided. He says clean mobility could either come from electric technology or from hydrogen-powered vehicle. There is uncertainty. "We need a proper study on this aspect, and need to understand pros and cons of Electric Vehicle and Hydrogen technologies. Just going into EVs is not right. We need to have a proper scientific study."
Thoughts About The Concerns Raised By Maruti Suzuki
We agree. Honestly, there isn't enough infrastructure to justify a mass movement to electric vehicles. The CNG segments are struggling with fuel stations even though CNG variants have been around for a few year. Electric is a universe away. In addition the incentives of the FAME II scheme are commercial vehicle specific. We now have a road-block in the Electric Revolution.
Could the Maruti Suzuki Wagon R Electric be priced at Rs 12 lakh? Or is it a top of the line sedan they speak of? I guess we wait. And watch.