'More hybrids you sell, greater the chances of EV success'

Indian roads are heading for better times with the government contemplating alternative technologies to power automobiles. Japanese auto giant Toyota is a proponent of hybrid cars, having sold 10 million units of hybrids, across 14 models, the world over. In India, Toyota Kirloskar Motor (TKM) retails the Prius and Camry Hybrid, apart from the super-luxury Lexus hybrid line-up. Shekar Viswanathan, Vice Chairman and Wholetime Director, TKM, shares the company’s hybrid vision to Hrithik Kiran Bagade of DH on the eve of World Environment Day. Edited excerpts:

What is the hybrid scene in India? How is the Indian market opening up to hybrid vehicles?
The time has come for India to make an aggressive adoption of hybrid technology, for it lowers the carbon footprint of the automobile industry, leading to lesser emissions and pollution. The market has definitely indicated acceptance, but the volumes are not as much at the moment, because most people don’t know what hybrid technology is all about. They also don’t know what electric technology is, and critical to the success of this will be the ecosystem that will evolve in the country. You need motor-makers, battery-makers, lithium-ion batteries for it to be a success.

What’s the scene in India in terms of batteries, considering that China is a huge player?
China is the largest provider of batteries because it has built scale, but I wouldn’t go so far as saying ‘India doesn’t stand a chance’. India needs to promote both hybrid and electric, because one will lead to better utilisation of the other. The more hybrids you sell, greater the chances of electric succeeding, and vice versa. Because when the battery costs drop, vehicle costs will drop.

What is the scope for hybrid vehicles?
Hybrid as a concept has worked in other countries, and we have had the happy spectacle of seeing over 10 million hybrid vehicles of Toyota sold the world over. They have not only been a success in view of reducing the carbon footprint, but commercially also, they’ve proven to be viable and sustainable.

What is the size of the hybrid vehicle segment in India? What is Toyota’s share?
As far as strong hybrids are concerned, we (Toyota) are the only ones making them currently. There are also different types of hybrids, like the mild hybrids, plug-in EV hybrids. The market has to expand. Right now, 2.8 million diesel and gasoline vehicles get sold every year, so I would think that the potential hybrid market would be a third of that. The current market is very small, because people are unaware.

What are the challenges to the hybrid industry in India?
The challenges to the industry begin from developing battery technology. Developing mass production of batteries helps in hybrids being sold in greater numbers. That’s why hybrid manufacturers also look at electric vehicles as they share the same components and ecosystem, the same motor battery, computer gadgetry that goes into controlling the vehicle. It is all a common feature for both segments. That’s why the hybrid industry would like to see the electric vehicle industry grow, and vice versa. For both, the battery cost dropping is key to their success. The main challenge for the EV industry is charging infrastructure.

The GST rate on hybrid vehicles has been levied at a rate as high as 43%. Do you think the government has been proactive in encouraging hybridisation?
The concerned department has been actively promoting hybrids and EVs. But why this hasn’t reflected in the GST rate is bit of a mystery, but I think the GST Council has got its hands full in terms of dealing with a slew of rates across the economy. We have made representations to the government and the GST Council to address this issue.

The same differential as that on EVs (12%) should also be applied on hybrid cars. I think there has been a lack of appreciation on the part of the Council on the nuances of hybrid technology. But I’m hopeful that this misstep will get corrected.

Meanwhile, the government is supportive, and has taken proactive steps in framing the NEMMP. However, the intent of the Ministry of Heavy Industries has not been effectively communicated to the GST Council.

How are hybrids better than mainstream fuel vehicles?
You have to lessen your dependence on fossil fuels, and gradually move to other technologies. You cannot build charging infrastructure overnight. You can’t wish away the entire internal combustion industry and only promote electric and hybrid industry.

It should be a gradual process. With the introduction of more hybrids, emissions will gradually come down, and when people get used to the concept, then you can start building the charging infrastructure, which will enable more electric adoption.