A Comparative Analysis of Vehicle Types in India: Current trends & which one should you choose!
Introduction
The
automotive sector is a crucial component of India's economic landscape, ranking
as the fourth-largest globally by production and valuation as of 2022, and the
third-largest automobile market in terms of sales as of 2023. As of April 2022,
India's automotive industry was valued at over US$100 billion, contributing 8%
to the country’s total exports and 7.1% to its GDP. Despite this significant
economic footprint, only 8% of Indian households own an automobile, with just
22 cars per 1,000 people. However, forecasts predict a dramatic increase in car
ownership, with a projected 775% rise over the next two decades, reaching 175
cars per 1,000 people by 2040. This surge in vehicle ownership is expected to
exacerbate issues such as pollution and traffic congestion, which already
strain Indian infrastructure. [1][7]
India’s
automotive market is characterized by a diverse array of vehicle types, ranging
from traditional petrol and diesel vehicles to emerging alternatives like
electric vehicles (EVs) and hybrid models. This diversity reflects the varied
needs and preferences of Indian consumers, who prioritize factors such as
affordability, fuel efficiency, and, increasingly, environmental
sustainability.
The
Current Debate: Affordability vs. Sustainability
The
Indian automotive market is at a crossroads, with consumers facing a dilemma
between affordability and sustainability. While traditional petrol and diesel
vehicles remain popular due to their lower initial costs and well-established
infrastructure, there is increasing pressure to adopt greener alternatives. The
introduction of electric vehicles has added complexity to the decision-making
process, as consumers must weigh the benefits of lower running costs and
reduced environmental impact against higher upfront costs and concerns about
charging infrastructure.
The
debate is further complicated by government policies and industry innovations,
which are rapidly shifting the landscape. As the market evolves, it is crucial
to understand the implications of different vehicle types in terms of
environmental impact, economic viability, and suitability for the unique
conditions of Indian roads.
Analysis
of Different Vehicle Types in India (
|
Vehicle
Type |
Operating
Mechanism |
Environmental
Impact |
Cost |
Suitability
for Indian Market |
Future
Outlook |
|
Petrol Vehicles |
Operate by igniting gasoline in
an internal combustion engine (ICE) to power the vehicle. |
High CO2 emissions; significant
contributor to air pollution. |
High running costs due to
rising fuel prices. |
Suitable for users with access
to extensive petrol infrastructure; less attractive due to rising costs and
emissions. |
Likely to decline as
regulations tighten and alternatives become more attractive. |
|
Diesel Vehicles |
Use compression ignition to
burn diesel fuel, providing power for the internal combustion engine. |
High NOx and particulate
emissions; more efficient but still contributes to pollution. |
More cost-effective for long
distances but with higher upfront costs. |
Traditionally popular for
long-distance travel, but declining due to narrowing price gaps and stricter
emission norms. |
Expected to phase out due to
declining demand and increasing regulatory pressure. |
|
Mild Hybrid Vehicles |
Use a small electric motor to
assist the internal combustion engine, improving efficiency without operating
independently. |
10-15% reduction in fuel
consumption and CO2 emissions. |
10-20% higher than conventional
ICE vehicles. |
Ideal for urban driving with
frequent stop-and-go traffic. |
Transitional technology;
expected to gain popularity as a bridge to fully electric vehicles. |
|
Full Hybrid Vehicles (HEV)* |
Switch between or combine an
electric motor and an internal combustion engine for propulsion. |
20-30% reduction in fuel
consumption and CO2 emissions; can operate in electric mode at low speeds. |
30-40% higher than conventional
ICE vehicles. |
Best suited for urban areas
with heavy traffic; offers significant fuel savings in city driving. |
Increasing adoption expected,
particularly in urban areas as fuel prices rise and environmental awareness
grows. |
|
Plug-in Hybrid Vehicles (PHEV)* |
Can operate on both an internal
combustion engine and a rechargeable battery that can be charged externally. |
Zero emissions in electric
mode; overall impact depends on electricity source. |
Up to 50% higher than
conventional ICE vehicles. |
Suitable for users with short
commutes and access to charging facilities; limited by charging
infrastructure. |
Dependent on charging
infrastructure development; potential for growth in urban markets. |
|
Battery Electric Vehicles
(BEVs)* |
Powered entirely by electric
motors using energy stored in rechargeable batteries. |
Zero tailpipe emissions;
overall impact depends on electricity source. |
High upfront cost but low
running cost. |
Best suited for urban
environments with short commutes; limited by range and charging
infrastructure. |
Promising future with
government support, advancing technology, and increasing consumer awareness. |
|
CNG Vehicles |
Run on compressed natural gas,
which is combusted in an internal combustion engine to produce power. |
15-20% lower CO2 emissions;
lower NOx and particulate emissions compared to petrol and diesel. |
Lower running costs but
slightly higher initial costs. |
Suitable for urban areas with
established CNG infrastructure; limited by availability in rural areas. |
Expected to grow in urban areas
with government support and expanding infrastructure. |
|
Hydrogen Vehicles/ Fuel Cell
Electric Vehicles (FCEV)* |
Generate electricity by
combining hydrogen with oxygen in a fuel cell, powering the vehicle's
electric motor. |
Zero emissions (water vapor);
highly environmentally friendly. |
High cost of production and
refueling infrastructure. |
Suited for long-distance travel
and heavy-duty vehicles; currently limited by lack of infrastructure. |
Future dependent on hydrogen
economy development; potential for long-term growth with significant
investments. |
*Abbreviations based on e-amrit
portal [4]
Bharat
Stage VI Emission Norms and Their Impact on ICE Vehicles
The
Bharat Stage (BS) emission norms are standards set by the Indian government to
regulate the output of air pollutants from internal combustion engines. These
norms, based on European regulations, have been progressively tightened over
the years to reduce the environmental impact of vehicles.
Impact on
Petrol and Diesel Vehicles: The implementation of BS-VI norms in 2020 marked a significant shift in
the Indian automotive industry. The new standards require vehicles to meet
stricter limits on emissions of NOx, particulate matter, and other pollutants,
leading to the adoption of new technologies and the discontinuation of older,
more polluting vehicles. The tightening of emission norms is expected to
accelerate the decline of traditional petrol and diesel vehicles in India.
Manufacturers are investing in cleaner technologies, such as turbo petrol
engines, hybrids, and electric vehicles, to meet the new standards. The
increased cost of compliance with BS-VI norms is also expected to drive up the
prices of ICE vehicles, further encouraging the shift towards cleaner
alternatives. [8]
Industry
Adaptation Strategies: The automotive industry is responding to the challenge of BS-VI norms
by developing new technologies and investing in research and development. This
includes the adoption of advanced emission control systems, such as selective
catalytic reduction (SCR) and diesel particulate filters (DPF), as well as the
development of alternative fuel vehicles.
Government
Policies and Incentives Regarding Electric Vehicles (EVs)
The
Indian government has introduced several initiatives to promote the adoption of
electric vehicles (EVs) as part of its broader strategy to reduce emissions and
improve air quality. These initiatives include subsidies, tax incentives, and
investment in charging infrastructure.
The
FAME-II Scheme: Launched
in 2019 with a budget allocation of Rs 10,000 crore, the Faster Adoption and
Manufacturing of Electric Vehicles (FAME-II) scheme is one of the key
initiatives introduced by the Indian government to promote EVs. It targets the
subsidization of various electric vehicles to promote cleaner and more
sustainable transportation options in India. The scheme provides subsidies for
the purchase of electric vehicles and the development of charging
infrastructure, with a focus on public transportation and shared mobility. [3]
As of
March 30, 2024, over 1,542,452 electric vehicles have been subsidized under the
FAME scheme, which includes 1,364,929 two-wheelers, 157,171 three-wheelers, and
20,352 four-wheelers. The scheme is set to conclude as initially planned on
March 31, 2024. In the Union Budget 2024, however, Finance Minister Nirmala
Sitharaman announced a reduction in the FAME scheme allocation to ₹2,671.33
crore and did not introduce FAME III. She indicated that the costs of electric
vehicles may decrease in the future due to a customs duty waiver on critical
minerals like lithium, along with falling market prices and the discovery of
new domestic reserves. [9][10]
State-Specific
Policies:
State-specific policies provide varying financial incentives for two-wheelers
and four-wheelers. States such as Gujarat and Maharashtra offer substantial
subsidies, while others like Andhra Pradesh focus on exemptions from
registration fees and road tax. The evolving policies address the cost barriers
to EV adoption and reflect a commitment to enhancing sustainable mobility in a
price-sensitive market, although the incentives differ significantly across
states. [2]
Comparing
the Emissions: EVs vs. ICE Vehicles vs. Hybrids
To
understand the full environmental impact of electric vehicles, it is essential
to compare their total lifecycle emissions to those of internal combustion
engine (ICE) vehicles and hybrids. Lifecycle emissions include not only the
emissions from production but also those from fuel or energy consumption,
maintenance, and end-of-life disposal.
2.1.
Production Emissions
The production of electric vehicles is inherently more carbon-intensive than
that of ICE vehicles and hybrids, primarily due to the energy required for
battery manufacturing and the extraction of raw materials.
The chart
below highlights the production emissions of these three vehicle types:
|
Vehicle
Type |
Total
Production Emissions (tons CO2e) |
Body
Production (tons CO2e) |
Battery
Production (tons CO2e) |
|
Electric
Vehicles |
14 |
9 |
5 |
|
Hybrid Vehicles |
10 |
9 |
1 |
|
ICE
Vehicles |
10 |
10 |
0 |
2.2.
Fuel/Energy Consumption Emissions
Fuel or energy consumption emissions vary significantly between vehicle types,
with electric vehicles generally producing lower emissions during operation
compared to ICE vehicles and hybrids.
|
Vehicle
Type |
Total
Fuel/Energy Production Emissions (tons CO2e) |
|
Electric
Vehicles |
26 |
|
Hybrid
Vehicles |
12 |
|
ICE
Vehicles |
13 |
2.3.
Tailpipe Emissions
One of the most significant advantages of electric vehicles is their lack of tailpipe
emissions, which directly contribute to air pollution in urban areas.
|
Vehicle
Type |
Total
Tailpipe Emissions (tons CO2e) |
|
Electric
Vehicles |
0 |
|
Hybrid
Vehicles |
24 |
|
ICE
Vehicles |
32 |
2.4.
Maintenance and End-of-Life Emissions
Electric vehicles are expected to have lower maintenance emissions compared to
ICE vehicles due to fewer moving parts and the absence of oil changes. However,
the recycling process for lithium-ion batteries is complex and costly limiting
the current recycling rate to around 5% and could increase emissions if not
managed properly.
|
Vehicle
Type |
Maintenance
(tons CO2e) |
End-of-Life
Emissions ((tons CO2e) |
|
Electric
Vehicles |
1 |
-2 |
|
Hybrid
Vehicles |
2 |
-1 |
|
ICE
Vehicles |
2 |
-1 |
2.5. Total
Lifecycle Emissions
When considering the total lifecycle emissions, electric vehicles generally
have a lower carbon footprint compared to ICE vehicles and hybrids. However,
this advantage is contingent upon the electricity grid becoming cleaner and
more reliant on renewable energy sources.
|
Vehicle
Type |
Total
Lifecycle Emissions (tons CO2e) |
|
Electric
Vehicles |
39 |
|
Hybrid
Vehicles |
47 |
|
ICE
Vehicles |
56 |
In
conclusion, electric vehicles offer significant potential for reducing
emissions compared to ICE vehicles and hybrids, particularly as India's energy
mix becomes greener. However, the higher emissions from production and the
challenge of battery disposal must be addressed to fully realize their
environmental benefits. [11]
Electric Vehicles: Current Status and Sustainability Challenges
Electric vehicles (EVs) are a
more efficient alternative to petrol vehicles, converting 59%–62% of electrical
energy into power at the wheels. However, their environmental impact can vary
based on local energy sources.
Current Landscape in India
India aims for 40% of its
electricity to come from non-fossil fuels by 2030. As of 2022-23, non-renewable
energy accounted for 79.66% of electricity production, while renewables
contributed 20.34%. [12] There are currently 934 EV
charging stations compared to 91,273 petrol stations, with the government
working to enhance infrastructure.
Key Challenges
EVs face significant drawbacks
including:
1. Lithium Mining: High CO2
emissions and groundwater depletion.
2. Cobalt Supply: Linked to human
rights abuses, particularly in the Democratic Republic of Congo.
3. Environmental Impact: Nickel
and graphite mining cause deforestation and pollution.
4. Battery Issues: Low recycling
rates (currently 5%), high replacement costs, long recharge times, and range
anxiety.
Path to Sustainability
To enhance EV sustainability, key
strategies include:
1. Transitioning to renewable
energy to reduce lifecycle emissions.
2. Improving battery recycling to
recover materials and reduce mining needs.
3. Promoting sustainable mining
practices.
4. Expanding public transport and
urban planning to lower emissions and dependency on personal vehicles.
By addressing these issues, the
EV sector can move toward a more sustainable future.
Economic Considerations for Indian
Consumers
Initial Purchase Costs: The
initial purchase cost of a vehicle is a significant factor for Indian
consumers, particularly in a price-sensitive market. While traditional ICE
vehicles tend to have lower upfront costs, the higher initial cost of EVs and
hybrids can be offset by lower running and maintenance costs over time.
Running and Maintenance Costs:
The running costs of a vehicle depend on factors such as fuel efficiency, fuel
prices, and maintenance requirements. EVs offer lower running costs compared to
ICE vehicles, as electricity is cheaper than petrol or diesel, and EVs require
less maintenance. However, the cost of battery replacement can be a significant
factor to consider.
Resale Value and Depreciation:
Resale value is an important consideration for Indian consumers, particularly
for those who plan to sell their vehicle after a few years. While traditional
ICE vehicles have established resale markets, the resale value of EVs and
hybrids is still uncertain, particularly as technology continues to evolve.
Long-Term Financial Implications:
When considering the long-term financial implications of vehicle ownership, it
is important to consider factors such as fuel costs, maintenance costs, and the
potential for future government incentives or regulations. EVs and hybrids may
offer significant savings over time, particularly as the cost of batteries
continues to decrease and charging infrastructure becomes more widely
available.
Indian Market Trends and Consumer Preferences
India's major car manufacturers are
cautious about fully embracing an electric future. They project that in five
years, internal combustion engine (ICE) vehicles, including CNG, will comprise
60% of sales, hybrids 25%, and battery electric vehicles (BEVs) just 15%.
Automakers see the coexistence of electric and alternative fuel vehicles with
traditional petrol and diesel cars as vital for cleaner transportation.
Currently, Maruti Suzuki leads in
CNG and hybrids but has no EVs, while Tata dominates the EV market but lacks
hybrids. In 2023, India introduced 51 hybrid models compared to 29 electric
models, highlighting hybrids as a transitional solution.
Hybrids are gaining traction, with
36% of consumers preferring them over BEVs, up from 32% in 2023. Despite
government incentives making EVs more affordable, hybrids are viewed as more
reliable, especially given India's developing charging infrastructure.
Furthermore, high taxes on hybrids (43%) versus EVs (5%) have sparked debate,
prompting companies like Tata to advocate for maintaining high hybrid taxes to
support a shift towards all-electric vehicles, which influences consumer
preferences. [5][6]
Conclusion
India’s
automotive industry is navigating a complex landscape, balancing the demands
for affordability, sustainability, and suitability for a diverse and growing
market. Traditional petrol and diesel vehicles, while still dominant, face
increasing pressure from stricter emission norms and rising fuel prices.
Meanwhile, the adoption of electric vehicles is gaining momentum, supported by
government policies and advancements in technology, though challenges related
to infrastructure and cost remain.
As
India’s energy mix becomes greener, and as investments in alternative fuels
like CNG and hydrogen increase, the automotive market is likely to see
significant shifts. Consumers, manufacturers, and policymakers must work
together to navigate this evolving landscape, ensuring that the transition to
cleaner, more sustainable vehicles is both equitable and economically viable.
Ultimately,
the future of the automotive industry in India will be shaped by a combination
of technological innovation, government policies, and consumer preferences. As
the market evolves, it is essential to consider the long-term implications of
different vehicle types, not only in terms of their environmental impact but
also in terms of their economic viability and suitability for India’s unique
conditions.
*Bonus*
Thumb Rule for Reducing Emissions
and Choosing the Right Vehicle
Walk or Cycle When Possible: Opt for non-motorized
transportation to reduce your carbon footprint and promote personal health.
Favor Public Transport: Use and advocate for public
transportation to decrease the number of individual vehicles on the road, significantly
lowering emissions.
Support Public Transit Expansion: Push for improved and more
extensive public transport systems in your community to enhance accessibility
and efficiency.
If you
are planning on buying a new vehicle:
Choose Budget-Friendly Eco
Vehicles: If on a
budget, opt for CNG vehicles or mild hybrids for lower emissions and fuel
savings compared to traditional vehicles.
Go Electric When Affordable: Invest in electric vehicles
(EVs) as they produce zero tailpipe emissions and deliver long-term cost
savings.
Utilize Renewable Energy for EVs: If driving an EV, charge it
using renewable energy sources, like solar, to further lower your overall
environmental impact.
Don’t
sell your ICE vehicle to go green unless the model is past the latest emission
norms
Maintain Your Vehicle: Regular maintenance is essential
for all vehicle types; ensure proper tire inflation, efficient engine performance,
and regular fluid checks.
By
adhering to these thumb rules, you can effectively reduce emissions and make
informed decisions when choosing the right vehicle for a more sustainable
future.
References
Kant, A. (2018, December 12). India has 22 cars per
1000 individuals: Amitabh Kant. Economic Times - Auto. Retrieved from https://auto.economictimes.indiatimes.com/news/india-has-22-cars-per-1000-individuals-amitabh-kant/67059021
2. Govt Website of Niti Aayog for E-Vehicles:
Niti Aayog. (n.d.). e-AMRIT. Retrieved from https://e-amrit.niti.gov.in/home
3. Electric Vehicle Incentives:
Niti Aayog. (n.d.). Electric Vehicle Incentives.
Retrieved from https://e-amrit.niti.gov.in/electric-vehicle-incentives
4. Types of Electric Vehicles:
Niti Aayog. (n.d.). Types of Electric Vehicles.
Retrieved from https://e-amrit.niti.gov.in/types-of-electric-vehicles
5. Comparison Between CNG & EV:
IOAGPL. (n.d.). A Side-by-Side Comparison of CNG
and Electric Vehicles. Retrieved from https://ioagpl.com/a-side-by-side-comparison-of-cng-and-electric-vehicles/
6. Consumer Preference in India:
Economic Times. (2023, October 20). Consumers bend
the road: No straight drive from ICE to electric. Economic Times. Retrieved
from https://economictimes.indiatimes.com/industry/renewables/consumers-bend-the-road-no-straight-drive-from-ice-to-electric/articleshow/110081285.cms
7. Automotive Industry in India:
Wikipedia. (n.d.). Automotive Industry in India.
Retrieved from https://en.wikipedia.org/wiki/Automotive_industry_in_India
8. Bharat Stage Emission Standards:
Wikipedia. (n.d.). Bharat Stage Emission Standards.
Retrieved from https://en.wikipedia.org/wiki/Bharat_stage_emission_standards
Economic Times. (2023, October 30). 2024 Budget:
Sitharaman gives EV industry neither FAME nor GST relief. Economic Times.
Retrieved from https://economictimes.indiatimes.com/industry/renewables/2024-budget-sitharaman-gives-ev-industry-neither-fame-nor-gst-relief/articleshow/111953653.cms
10. Union Budget 2024 - EV Makers' Response:
Indian Express. (2024, January 31). Union Budget
2024: EV makers, buyers, mixed bag. Indian Express. Retrieved from https://indianexpress.com/article/technology/tech-news-technology/union-budget-2024-ev-makers-buyers-mixed-bag-9471019/
11. Polestar & Rivian Pathway Report:
Kearney. (2023). Polestar and Rivian Pathway Report
- Supported by Kearney. Retrieved from https://www.kearney.com/documents/291362523/295334577/Polestar+and+Rivian+pathway+report-+supported+by+Kearney.pdf
12. Energy Statistics India 2023:
Ministry of Statistics and Programme Implementation
(MoSPI). (2023). Energy Statistics India 2023. Retrieved from https://www.mospi.gov.in/sites/default/files/publication_reports/Energy_Statistics_2023/EnergyStatisticsIndia2023.pdf
For Further Reading
- Bureau of Energy Efficiency (BEE)with feautres to calculate benefits of EV:
Bureau of Energy Efficiency (BEE). (n.d.). EV Yatra - Total Cost of Ownership Calculator. Retrieved from https://evyatra.beeindia.gov.in/
- Climobil to compare EV & ICE emissions for EU & US:
Climobil.
(n.d.). Comparison of Electric and Conventional Cars. Retrieved from https://climobil.connecting-project.lu/
- Measures to improve EV Battery Health:
EVpedia.
(n.d.). Guide to Your Li-ion Electric Vehicle Battery. Retrieved from https://www.evpedia.co.in/expert-corner/guide-to-your-li-ion-electric-vehicle-battery
- A case study on EV vs HEV vs PHEV vs ICE at Indonesia:
ScienceDirect.
(2023). Comparison of Electric, Hybrid, and Internal Combustion Engine
Vehicles. Retrieved from https://www.sciencedirect.com/science/article/pii/S1110016823009055
Comments
Post a Comment