9% urban Indian households say will buy an electric vehicle in 2020; Care for environment listed as top reason for buying it

February 14, 2020, New Delhi: Environmental pollution has risen up to be a key global talking point in the last few years and vehicle emission is one of the top contributors to this issue. The United Kingdom recently proposed to end sales of all non-electric cars by 2035 while European nations like Denmark, Sweden, Netherlands and Ireland have bans in place from 2030.

India has some of the most polluted cities in the world and the Government has been scampering to find a solution for it. Budget 2020 allocated around 7500 crores for the upcoming year towards environmental work. But when it comes to reducing vehicle emissions, Electric Vehicles could become an integral part of the approach. To get a consumer pulse on the acceptance of Electric Vehicles popularly known as EVs in India, LocalCircles in collaboration with CNBC TV-18 conducted a 4-poll survey. The survey covered various urban households and received more than 32,000 votes from around 180 urban districts of the country.

The first question asked consumers if they or their family were considering purchasing an electric vehicle in the next 12 months. 9% consumers said they will buy an electric vehicle in 2020 while another 27% said they might consider buying an electric vehicle. 54% said they will not be buying and 10% were unsure.

9% urban households say they will buy an electric vehicle in 2020; another 27% express interest

After Tesla initially owned almost all of the EV segment, many companies in the last few years have come up trying to enter the EV bandwagon. In India, companies like Maruti Suzuki, Tata and Mahindra have become the leaders in this segment. While Tata and Mahindra have already launched some of their Electric Vehicle models, Maruti Suzuki along with a few other companies showcased their concept and production ready models in Auto Expo 2020.

Next question asked consumers if they or family were considering buying an electric vehicle in the next 12 months, what was the primary reason for it. Concern for environment came out as the top reason why consumers are considering buying an electric vehicle. 13% said they are planning to buy an electric vehicle due to the lower total cost of ownership it provides while 52% said it will be their contribution towards a cleaner environment. 19% said they are considering buying an EV as they have had enough of buying fuel and coping with fuel price fluctuations. 7% said they are planning to buy in hope that the central or state Government will provide some subsidy while another 7% said they had other reasons. This is a positive development as it appears that over half of those considering buying electric vehicles seem to be citizens aware of the air pollution issues and its impact and want to do something about it.

Concern for environment top reason why urban households are considering buying an electric vehicle

Buyers might also not be so eager to purchase an electric vehicle since they cost much more than their petrol or diesel counterparts. When asked how much they or their family were looking to spend on their EV purchase, 38% said 8-10 lakhs, 27% said 10-15 lakhs and 23% said 15-20 lakhs. 10% were unsure if they will buy an EV in the next 12 months. Overall, 65% of the consumers who are considering buying an electric vehicle will like to spend less than 15 lakhs on it.

65% of the urban households who are considering buying an electric vehicle will spend less than 15 lakhs on it

The final question asked what was the top reason that is limiting them from buying an electric vehicle in the next 12 months. 27% said EVs are more expensive as compared to regular vehicles while 15% said there are not enough charging stations in my city/town. 3% said they don’t have enough choices of models in their budget and 10% said they don't know enough about EVs. 24% said they don't have a need to purchase a vehicle at this time, 13% said they don't have the funds to purchase a vehicle at this time and 8% said they had other reasons.

Higher price is the top reason why urban households are not considering buying electric vehicles

Looking at the results of the survey, higher prices seem to be the top reason why consumers are not considering buying electric vehicles. The limited charging infrastructure also poses a challenge in owning electric cars in India.