February 19, 2024

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The price of EVs and ICEs will be equal in 12-18 months: Shailesh Chandra

The price of EVs and ICEs will be equal in 12-18 months: Shailesh Chandra

According to Shailesh Chandra, we will see a 200-250 km real range car in the mass market in less than a year, 1 and a half years


The cost of batteries has reached a magical level of $100 kilowatts per hour, making it possible for a mass-market electric car with a real range of 250 kilometers within the next 18 months to be priced at a similar level to internal combustion engines (ICE) vehicles, according to Shailesh Chandra, MD for Tata Passenger Electric Mobility. 

During his speech at Autocar Professional’s India EV Conclave, held in partnership with the Tamil Nadu government, Chandra stated that electric vehicle early adopters are willing to pay a premium of 20-30% over traditional ICE vehicles. However, mainstream customers expect an EV to be priced the same as an ICE vehicle. Chandra predicts that in less than two years, we will see a real range car of 200-250 km in the mass market.

According to the head of India’s biggest electric car manufacturer, the cost of internal combustion engines is set to increase due to emission compliance requirements. In contrast, electric vehicle costs are expected to decrease, as technology costs decrease and battery prices fall. Therefore, the future cost trends for these two types of vehicles are expected to be the opposite, with the cost of internal combustion engines increasing and the cost of electric vehicles decreasing.

Chandra made a statement regarding the deflationary trend that is expected to be witnessed by EVs. As per Chandra’s assertion, a breakpoint is expected to occur due to this trend.

The cost of electric vehicles is still 25-35% higher than conventional cars due to high battery costs and significant import content.

Chandra believes that a reduction in GST to 5 percent, along with the benefits obtained from the government of India’s production-linked incentive scheme and the falling battery cost, will not only allow the company to price its products competitively but also help the EV business start making profits.

Tata Motors has established a prominent position in the fast-growing market of electric vehicles, with an impressive market share of over 85%.

For the first time in history, it is expected that the number of electric cars sold in India will exceed 100,000 this fiscal year. The producer of Nexon and Tiago EV is also expected to achieve annual sales of six figures within the next year.

According to Tata Motors, it plans to build a portfolio of 10 electric vehicles by 2025, investing $2 billion in its EV business. The company already sells about 15% of its total volume through EVs, and by 2026-2027, it expects to sell 30% of its total volume through EVs.

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