EV demand up over 100% last year as E-commerce, FMCG cos look to cut costs & reduce carbon emissions

Demand for electronic vehicles is on a steep rise among e-commerce companies, witnessing a jump of more than 100 per cent in the last year. The reasons behind this are reduction in cost (which can come down by half) and meeting carbon emission reduction targets.

A report by Economic Times states that companies like Amazon, Zomato, Coca-Cola, Swiggy, Bisleri, Amul, and Flipkart are among those adopting EVs in their daily processes.

Amul's managing director, Jayen Mehta, told the publication, "We have started EVs for last-mile deliveries for ice-cream vending," further adding, "Our milk distributors too are using EVs in Delhi, Uttar Pradesh, Haryana and Punjab."

Amitabh Saran, electric three-wheeler company Altigreen's co-founder, said, "The operating costs are about a fraction of diesel or CNG-driven ones, translating into substantial savings for operators." His company has supplied EVs to the likes of Amazon, Flipkart, BigBasket, HUL, Bisleri and Coca-Cola. Saran also told ET, "Even if we were to carve out use cases which require heavier payloads and exports, the market size is still about 1.2-1.3 million units per annum. India has not yet explored formats for three-wheelers fully. The potential is huge."

It is expected that 100,000 electric cars and about a million two-wheeler EVs will be sold this fiscal year. However, in FY23, 50,000 electric cars and 727,000 E2Ws were sold. With this increase in adoption, e-commerce companies are also investing in charging stations across the country.

We can get a clear picture of how operating costs will come down from a statement by Sameer Aggarwal, who has founded a company that finances purchase of three-wheeler EVs.

"The running cost per km for an electric vehicle for commercial use is nearly a fourth of the current Rs 4 for a petrol or diesel vehicle," he said to the publication.

Aggarwal further revealed that the EVs constitute around 50 to 55 per cent of the three-wheeler market in the country. He also said, "We expect this penetration to increase to 80 per cent in the next one year".

"In the two-wheeler space also, 60-70 per cent of the market should go electric in the next three years", Aggarwal added.