Holistic Government Initiatives Can Bridge Gap Between Electric & ICE Vehicles: Here's How?

Of late, the global automotive industry has witnessed a transformative shift towards sustainability and environmental consciousness owing to factors such as alarming pollution levels, surging fuel prices, among others. In this regard, electric vehicles (EVs) have emerged as a promising option to their Internal Combustion engine (ICE) counterparts. However, their adoption continues to be marred by considerable challenges. To mitigate these bottlenecks, governments across the globe have rolled out numerous initiatives.

This includes the ambitious Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme by the Government of India. But as the EV ecosystem matures, it is becoming increasingly evident that a comprehensive approach that transcends beyond subsidies is the need of the hour to bridge the gap between EV and ICE vehicle adoption. The challenges related to the adoption of Electric Vehicles (EVs) are considerable and multifaceted.

Re-assessing subsidies

Undoubtedly, India's FAME scheme has played a crucial role in stimulating the EV market. However, eminent industry experts are now realising that relying solely on subsidies may not be rewarding in the long term.  Recently, Bhavish Aggarwal, Founder and CEO of Ola Electric, echoed this sentiment. While the business veteran praised the initial impact of subsidies, he underlined the significance of moving beyond them.

Aggarwal opined that a significant investment in technology and innovation by original equipment manufacturers (OEMs) will give rise to a self-sustaining and robust EV ecosystem, and team iVOOMi strongly advocates his thoughts.

Range anxiety remains a noteworthy concern for potential EV buyers. Unlike ICE vehicles that offer long refuelling ranges, EVs demand an extensive charging infrastructure for a convenient travel experience. Also, in spite of improvements in fast-charging technology, the time required to charge an EV can still be a barrier. Another major roadblock in the EV space is the consumer perception regarding the reliability and longevity of EVs vis-a-vis their ICE counterparts.

Despite offering numerous advantages like instant torque and low maintenance requirements, EVs are new entrants in the automobile sector and do not have the edge of a proven and familiar technology base like ICE vehicles.

Numerous consumers also harbour safety concerns about EVs, particularly regarding battery fires and crash performance compared to conventional ICE vehicles. Further widening this gap are the high initial purchase costs of EVs compared to ICE vehicles, primarily due to the cost of batteries.

Despite lower operating and maintenance costs, the upfront investment can be a considerable obstacle for many potential buyers. This calls for a host of innovative financing options backed by special incentives and schemes  that are specifically tailored for EVs.

Moreover, while charging networks are gaining momentum, building a robust and easily accessible charging ecosystem, especially in rural and remote regions of the country, remains pivotal.

Potential solutions and innovations

To bridge this prevailing gap between EV and ICE vehicles, a multidimensional approach by the government is crucial. This can encompass a holistic package of incentives, including tax benefits lowering the registration fee and other benefits beyond financial subsidies.

Furthermore, investing in charging infrastructure is strongly emphasised, especially in underserved regions. In this regard, the participation of private sector players can expedite the establishment of a widespread charging network.

In addition, collaborations between universities, research organisations, and EV players can lead to breakthroughs in battery technology, addressing concerns regarding the range and the overall performance of vehicles.

Another game-changing measure to revolutionise EV adoption could be government-backed financing programs with competitive interest rates as well as tailored financing options for prospective EV buyers. This could make EVs a more alluring alternative for a broad segment of consumers and ensure a level playing field for EV and ICE vehicles.

Lastly, consumer perceptions regarding safety can be addressed via extensive, transparent communication campaigns, confirming stringent safety testing and the inclusion of modern safety features in EVs.

While subsidiaries such as the FAME scheme have been instrumental in propelling initial sales of EVs, it is now apparent that a more comprehensive approach is required to bring the next cycle of growth for the segment.

A well-coordinated effort involving the entire stakeholders is critical to drive the transition towards a sustainable and electric future for the automotive industry and despite a slow progress, Iam confident that we are on the right track.

This article is authored by Ashwin Bhandari, Co-Founder and CEO, iVOOMi. All views are personal.