The MD and CEO of Piaggio Vehicles (India) is bullish about the growth potential of e-3Ws driven by government incentives, low cost of operation as well as total cost of ownership of these livelihood-centric vehicles, compared to their ICE-powered counterparts.
09 Oct 2024 | 861 Views | By Mayank Dhingra
Piaggio Vehicles (India), which is among the key players in the electric three-wheeler segment in India and ventured into this category in 2019 with its Ape E-City, is bullish about the growth potential of e-3Ws in the country.
The company, which clocked 12,750 units of e-3Ws sales between January ...
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Piaggio Vehicles (India), which is among the key players in the electric three-wheeler segment in India and ventured into this category in 2019 with its Ape E-City, is bullish about the growth potential of e-3Ws in the country.
The company, which clocked 12,750 units of e-3Ws sales between January and July 2024 and was ranked No. 6 in the tally, presently sees these zero-tailpipe vehicles comprising about 25% of its total three-wheeler production. Driven by the robust demand, it anticipates penetration of electric three-wheelers to hit as high as 80% by 2030.
Speaking to Autocar Professional, Diego Graffi, Chairman and MD, Piaggio Vehicles (India), said, “We launched our first e-3W five years ago and the response to our products has been much higher than our initial expectations. While we were anticipating e-3W volumes in the range of 500-1,000 units every month, we are now doing more than 3X the numbers in terms of consolidated volumes. Over 25% of our total three-wheeler production is now in the EV segment.”
“If the growth continues at the current pace, we expect the penetration to hit 70-80% by 2030 in the e-3W segment because these vehicles offer the best compromise between the cost of acquisition and operation,” he added.
Of all the vehicle categories, it is the electric three-wheeler segment which is witnessing the fastest transition to e-mobility. As per Autocar Professional’s analysis, of the total 896,619 units of three-wheelers, across petrol, diesel, CNG, and electric powertrains, sold between January and September 2024, e-3Ws account for 56% or 501,051 units, followed by CNG-powered three-wheelers at 262,900 units.
Subsidies to stabilise demand
However, Graffi cautioned that the growth would also depend upon incentive schemes from the government. While demand for e-3Ws maintained a strong double-digit growth under the FAME-II scheme effective from April 2019 to March 2024, it reduced to a muted single-digit growth with incentives under the EMPS scheme that followed for the next few months, until also being phased out on September 30, 2024.
Now, under the latest PM E-Drive scheme, incentives have been announced to subsidise 316,000 e-three-wheelers over the next two years, albeit with a reducing
“While we only see a positive outlook going forward, the demand will also depend on the continuation of government incentives. Incentives (under the PM E-Drive scheme) will give stability to the demand for the next 2-3 years and then, it will not be a dream to see the penetration in the e-3W segment to go much beyond than what we see right now,” Graffi said.
As per Graffi, since these vehicles are used for livelihoods, the cost operation is a key consideration factor in this category. “These vehicles are not used for general commuting, and therefore, in absolute terms, the cost of operation of an EV is the lowest for three-wheelers,” he added.
Bullish about battery swapping
Piaggio, which introduced battery swapping on its maiden e-3W when it first forayed into the segment five years ago, remains confident about the future of the solution in India. “We have been one of the first players to enter the e-3W segment with our innovative battery-swapping technology. Today, we offer both fixed and battery-swapping options in our products,” Graffi said.
He mentioned that there needs to be a holistic effort towards strengthening of battery swapping infrastructure to boost its adoption. “Provided that there is a combined effort between OEMs, infrastructural players, and the government, we see battery swapping to flourish in the future.”
Graffi pointed out that the main limitation hindering the growth of e-3Ws equipped with swappable batteries is the availability of investment for their infrastructure. “As a matter of fact, the cost of one battery swap station is much higher than a normal fixed-battery charging station. Also, the kind of electrical connections are required to support these swap stations is much more complex,” he highlighted.
“All these challenges remain, but we see a lot of players come up and be keen to invest into this space, and take initiatives along with OEMs and the government. As Piaggio, we are also targeting some cities in India as a pilot to spread battery swapping more widely. Having said that, we need strong support from local government and municipality authorities,” Graffi said.
Within the e-3W segment, Piaggio sees opportunity for introducing more products to cater to the varying needs of different operators. “It is an application that calls for more customisation, not so much in terms of new models as there are only goods- and passenger carriers, but, for instance, in the passenger category, there is scope for introducing more options offering better space and range. We are exploring those opportunities,” Graffi signed off.