Tuesday, October 3, 2023

Outlook 2021: Future of last-mile electric shared mobility in India


By Mohit Sharma and Akashdeep Singh

The last mile electric shared mobility has seen rapid growth in India in the last decade. However, the pandemic has caused havoc to the industry. What’s in the future for this sector?

It is critical for electric vehicles to hit the roads now more than ever in India. Statistics show that vehicles that run on fossil fuel contribute to 60% of PMs (particulate matter-related atmospheric pollution) and over 20% of CO2.

In addition, nearly 70% of the fuel used in petrol and diesel-run vehicles is wasted. (source: Yourstory). When this is put in context with the rising fuel prices, it is imperative that India switches to EV as quickly and as efficiently as possible. So, what is holding India back from reducing its carbon footprints?

Electric vehicles ecosystem in India: Challenges and solutions

The biggest challenge faced by EVs in India is the lack of EV infrastructure – charging infrastructure and battery-swapping stations which has hindered the potential growth of EVs in the country.

Statistics show that as of 2018, India had nearly 425 charging points that were publicly available. However, through government and private efforts, the charging infrastructure is expected to increase to approximately 2,800 charging points by 2022.

Faster Adoption and Manufacturing of Electric Vehicles (FAME), India’s scheme to speed up EV adoption is well into its second phase. With a visible relaxation in custom duties on EVs, battery prices, technological advancements in the new age batteries that we use today, it is an encouraging environment for EVs and green mobility.

To promote mass adoption of EVs, especially for public transport in India, the high charging time leading to high down-time for e-rickshaws/ e-scooters as compared to their petrol counterparts also needs to be solved.

Given the present ecosystem, battery swapping addresses the issue of a quick recharge for E-rickshaws/e-scooters. Battery swapping allows the EV owner to replace their discharged battery with a fully charged battery in no time. They get to do this from a designated charging station and continue the business, without sacrificing time and in turn income.

But this is expensive especially if India has to depend on other countries for its vehicles and battery demand. As a solution, in addition to reducing custom duties, the government is also working towards making India a self-efficient and sustained EV market. The government is urging vehicle manufacturers to develop and manufacture EVs in the country.

The most recent push from the government is the production-linked manufacturing (PLI) scheme worth Rs 18,000 crores to promote lithium-ion cell manufacturing in India. The growth of EVs in India is steadily increasing.

There has been a huge perception shift in the last 2 decades. Earlier, the majority of people were of the opinion of owning their own vehicle and some would even go for a second or a third car, depending on the size of the family and requirement. Now, more and more people think and know that it is wiser to have an option of shared mobility.

This has allowed India to also bring down its carbon footprint drastically. The advancements in the mobility space through technology has further accelerated the adoption of shared mobility services in the country. The key necessity that led to this rapid adoption: broken mobility. 

On-ground realities: Lack of last-mile connectivity

Studies show some surprising numbers, 82% of Indians do not even own a vehicle. This means that a vast majority of Indians depend on inadequate (public), unreliable (autos, friends/family), or expensive (cabs) transport options for their commute needs.

Most people stay at an average of 1.8 km distance from any form of public transport. Very few places have immediate access to public transport. Most distances of more than 7 km do not have a direct public transport option, which means that people are to change buses/metros.

So the need of the hour becomes – providing an economical commute option, thus catering to the entire cross-section of mobility seekers. E-rickshaws are catering to this but to reach the full potential, we do need service aggregators, who tie all the ends together and make the experience come alive.

shared mobility

Shared mobility: One stop solution

The core idea of shared mobility is to give people access to mobility as and when they need it. But that is not the only problem that shared mobility offers solutions for. The two other issues that shared mobility solves more specifically in most Tier 1 cities are pollution and traffic congestion.

Shared mobility amongst commuters is rapidly gaining popularity. There has been a sharp pivot in the buying choices taken by the public who prefers to rent/share resources than to own their vehicles. They are more conscious of the impact that their choices make on the environment.

The recent rise in shared mobility start-ups managed to act as a catalyst to speed the change. Shared mobility has not only bridged the gap of broken mobility but also worked to reduce the carbon footprint of the country.

shared mobility

Shared electric micro-mobility: Tailor-made solution for India

The indispensable public commute option of the Indians is fondly known as “autos” or “rickshaws”. It is endemic to the country and is a universally accepted mode of commute for all. 

A McKinsey article reports that three-wheeler vehicles, which are considered to be passenger mobility’s greatest demand driver, is expected to grow 40 to 50% YoY, indicative of Indians’ preference to travel via rickshaws.

Additionally, as per Mordor Intelligence, the Indian electric rickshaw market is expected to register a CAGR of 15.45%, during the forecast period, 2020-2025, as a direct indicator of the fact that the e-rickshaws segment has picked up pace in our country. This is because of two reasons: the ease in policies through support from the government and also because it suits the Indian commuters’ needs.

In an effort to connect people with public transportation and nearby public places, micro-mobility players such as we at Oye! Rickshaw, provide an app-based e-rickshaw booking facility to the users. In addition to reducing traffic congestion, this helps to bring down carbon emissions thereby reducing carbon footprints in India.

India 2021: Future of shared electric micro-mobility

The shared mobility space is currently one of the fastest-growing sectors in India and is witnessing tremendous innovation with a market opportunity of $129 billion. India is foreseen to become a leader in shared mobility space by 2030 with shared miles expected to reach 35% of all the miles traveled by 2030 and 50% by 2040.

The future of last-mile shared electric mobility is promising, despite the EV sector in India still being in a nascent stage, without a doubt. There are already close to 2.5 million e-rickshaws that are currently active.

Adopting options that are responsible for the environment will give a boost to the electric shared mobility market, battery design, and technological advancements even from a very base level. It is one of the best alternative routes that India can successfully adopt especially in urban transport, which promotes the judicious use of energy and reduces carbon footprints.

Also Read: E-rickshaw best route to proliferate electric shared mobility: Mohit Sharma

(Mohit Sharma is the Co-Founder & CEO of Oye! Rickshaw. Akashdeep Singh is the Co-Founder of Oye! Rickshaw.)

(Disclaimer: The views expressed in the article above are those of the authors’ and do not necessarily represent or reflect the views of Autofintechs.com. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.)


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