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Powering the Last Mile: Navigating Trends in the India Electric Rickshaw Battery Market

In June 2023, the Uttarakhand High Court has asked the Nagar Palika Parishad to convert all pedal/cycle rickshaw permits to e-rickshaw permits. This is in keeping with the rising demand for these eco-friendly modes of short-distance transport across the country. According to the Federation of Automobile Dealers Associations (FADA), electric rickshaw sales in the country in February 2023 were 89% compared to February 2022.

Most of these sales are powered by the government initiatives to urge people to shun their petrol/diesel vehicles, at least for short distances and last-mile commuting, and opt for public transport instead. For instance, in 2020, the Tamil Nadu government had unveiled over 10 types of battery- and solar-powered rickshaws. The state government had also announced its EV policy in 2019 with the aim to garner USD 7 billion (INR 500 crore) worth of investment in EV manufacturing.

Moreover, a report had pointed out that only eight Indian states had fewer than 1,000 of these registered three-wheelers and that Uttar Pradesh, Delhi, and Bihar topped in e-rickshaw registrations, with 403,411; 117,885; and 108,669 vehicles registered. Such numbers hint at a major opportunity for companies in the Indian electric rickshaw battery market, which has been forecast by P&S Intelligence to reach USD 295.4 million by 2030.

Just like any EV, the battery and motor are the costliest components of an e-rickshaw. This is why the battery needs to be highly efficient, allowing for long driving ranges on a full charge, and have a long overall life for it to be cost-effective. Up till half a decade ago, sealed lead–acid (SLA) batteries were preferred because they were the only ones available, widely known, and cost-effective.

However, with concerns over the short driving range, disposal issues, short life, and fewer charge cycles they entail, lithium-ion batteries are becoming increasingly popular. Still, despite their advantages of a higher charge capacity, lower self-discharge rate, more charge cycles, and longer life, their sales are somewhat marred by their higher price. This is because lithium and cobalt, two of the key materials utilized in these power storage systems, are costly.

Moreover, since India sources all of its lithium from other countries, the import duty makes it even more expensive. Between the April of 2022 and January of this year, we imported lithium worth INR 18,763 crore. However, in February 2023, the Geological Survey of India found 5.9 million metric tonnes of Li reserves in the Reasi district of Jammu & Kashmir. With the government planning to swiftly auction the blocks to private players for extraction, Li-ion battery production in India could get a boost and the prices of these components could come down.

Other states with possible reserves of this key metal are Rajasthan, Jharkhand, Chhattisgarh, Arunachal Pradesh, Meghalaya, Nagaland, Gujarat, and Ladakh (UT). Experts believe that with India beginning to locally source lithium, the price of cells for Li-ion batteries could come down by up to 30%, which could make e-rickshaws cheaper by 15%, if not more.

Electric Mobility Services Market Is Driven by Increasing Environmental Concerns

The global electric mobility services market is witnessing growth. This development can be credited to the reasonably lesser price of ownership attached to the electric fleet, armed with the surging ecological worries throughout the world.

In recent years, the two-wheeler sharing category led the electric mobility services industry, based on service type. This is credited to the fact that apart from being a suitable, inexpensive, and quicker mode of traveling, e-two-wheeler sharing facilities also fulfill the requirement for last-mile traveling throughout the globe.

The category is further divided into scooter sharing, bike sharing, and kick scooter sharing. Between them, the bike-sharing category had the largest industry share in recent years, credited to the enormous utilization of these services in China.

The passenger car category is further segmented into plug-in hybrid electric vehicles and battery-electric vehicles. Between them, the BEV category is responsible for the greater share in the industry in recent years, ascribed to the helpful government steps, in the form of incentives and strategy formulations, which inspire the acceptance of such vehicles, and the working advantages BEVs provide over plug-in hybrid electric vehicles.

In the past few years, last-mile commuting was the largest category in the industry, based on commuting patterns. Also, the category is projected to stay the largest industry in the projection period. This is mainly because e-mobility services offer ease to users, to commute even the shortest distances, from mass transportation spots, like metro stations and bus stops, to their terminus, therefore removing the requirement to walk down that distance.

In the past few years, many cities across China augmented the utilization of electric vehicles (EVs) across numerous service channels, to encourage a greener atmosphere. With constant backing from the government, in the form of strategies and incentives, the industry in China is projected to showcase strong growth in the near future.

Hence, the reasonably lesser price of ownership attached to the electric fleet, armed with the surging ecological worries throughout the world are the major factors propelling the industry.

Carsharing Market: Increasing Demand for Flexible and Sustainable Transportation Options

To meet environmental and community transportation objectives, Carsharing is great model. According to its goal, vision, and principles, fewer people own personal cars, less driving is done, urban land usage and development are improved, and everyone has access to automobiles at a reasonable price. P&S Intelligence, by 2030, it is expected that the worldwide carsharing market would be worth USD 9,957 million.

Moreover, the expansion of this business on a worldwide scale has been accelerated by technical advancement. This service is built on the use of smartphone applications, where consumers and service providers connect to schedule rides and make associated payments.

This covers the production of their materials and the electricity needed to keep them running. Additionally, it is anticipated that the market acceptance of electric automobiles would expand quickly due to their cheap maintenance costs.

Compared to gasoline or diesel vehicles, electric vehicles offer cheaper running expenses. Charging an electric car is less expensive than buying petrol or diesel for transportation requirements due to the comparatively cheap cost of energy. If charging is carried out using renewable energy sources that are already installed at home, the cost of power can be further decreased.

Along with a one-time registration fee, customers can make payments based on the distance and time they travel. Additionally, these service companies take care of other charges like those for parking, gasoline, maintenance, and insurance.

Moreover, they may quickly use the service and reserve the vehicle of their choice using the company’s smartphone. The app offers customers all the information and help they need to ensure a comfortable experience.

Rapid urbanization and industrialization are also contributing significantly to the market’s expansion. Furthermore, countries with high pollution levels include Taiwan and India.

The governments in these nations are concentrating on building solid infrastructure and road networks and increasing the number of electric vehicles in the carsharing fleets to reduce pollution levels and the rate of private vehicle ownership.

India Electric Rickshaw Market: Government Initiatives and Incentives Boosting Adoption

Talking about the emergence of e-rickshaws in India, they first hurled on the Indian roads, over a decade ago in 2011. Since then, there has only been an increase in the number of e-rickshaws on Indian roads.

The popularity of these vehicles has increased immensely all over India, thanks to their ability to carry 4-5 passengers comfortably over a short distance, rather economically, and the most notable factor is that, all this is done without any emissions.

In cities like Delhi, these have emerged as a livelihood source for people, and a sustainable and economical commute for commuters.

With present looking secure, let’s find out something about the future of these modes of communication in India.

How is the Future of e- Rickshaws in India?
When initially they busted on to the scene in India, e-rickshaws were imported, but with the increased interest of the people, and their potential on Indian roads, currently they are manufactured in the country itself. There are a number of manufacturers, producing advanced Lithium-ion batteries and there is a rapid growth of this entire ecosystem.

Though, with the expansion of battery swapping networks, it is becoming more and more possible for e-rickshaw drivers to drive to the nearest swapping station, get the exhausted battery replaced with a charged one, and get back on track without wasting too much time, and losing the opportunities to earn.

Taking all these factors into consideration, and the increasing concerns raised by environmental organizations around the world regarding the problem of emissions, and all the countries trying to mitigate it at their level, it is only fair to say that the future of e-rickshaws in India looks a promising prospect to say the least.

This growth of the e-rickshaws in India has a lot to do with the increasing average age of these rickshaws, and the constantly increasing number of rickshaws hitting the roads of the country.