In India, battery swapping fuels electric market for 2 and 3 wheels
BY: BILL SPINDLE
Electric car sales are skyrocketing in China, rising in Europe and getting started in the United States. But when it comes to using batteries to transform transportation and cut greenhouse gas emissions, India, with its fast-growing market for electrified motorcycles and auto rickshaws, is the hothouse of innovation.
Across the world’s most-populous country and a rapidly growing economy, companies are lowering the costs, and spurring sales, of two- and three-wheeled electric vehicles with battery swapping networks. These networks allow the vehicles to be sold separately from their power sources.
For buyers, be they individuals looking to get around or delivery companies building thousands of vehicle fleets, buying an electric motorcycle or auto rickshaw without the battery cuts the upfront cost in half. The fuel — electricity — is paid for as needed, just like paying for petrol for a combustion engine, but on a subscription plan and at a fraction of the price. Owners swap drained batteries for charged ones at kiosks in less time than it takes to fill a combustion-engine vehicle with gasoline.
Lower vehicle prices, in turn, are opening a vast new market for EVs in a country whose population of 1.4 billion is migrating into cities and reaching driving age at a rapid clip. A small segment of the population is graduating from bikes and motorcycles to cars — as has happened in many countries as their economies developed. Many more are reaching an age and gaining enough buying power to purchase or lease a motorized two-wheeler for the first time.
“You have 100 million people coming into this segment, and another 100 million people coming in the next segment,” said Chetan Maini, the founder and chief executive at Sun Mobility, a company that runs a fast-expanding battery swapping network in the country.
The battery swapping business models emerging in India are spreading across developing economies and could reshape how energy is used for transportation.
India is the world’s third-largest emitter of carbon dioxide and its vehicle market is still in its infancy. There are only 22 cars per thousand people, compared to 980 in the United States and 850 in the United Kingdom. Meanwhile, nearly half of Indian households already own a motorized two-wheeled vehicle, nearly all of them traditional combustion engines.
To be sure, most of India’s carbon emissions come from its coal-dominated power sector. But electric vehicles use energy so efficiently they may help reduce emissions even when charged with electricity from coal. And the country is ramping up clean sources of power, which over time could reduce coal use. EVs could also help clean up India’s chronic traditional air pollution, often the worst in the world.
The government aims to raise the share of electric vehicles to more than one-third of annual sales by 2035, and to 50% by 2070. Already about half of three-wheel auto rickshaws sold are electric models, while electric two-wheelers account for about 4% of sales and electric cars about 1%.
Achieving the government’s goals could help India reduce its projected energy demand 30% by 2050, according to the International Energy Agency. The country has a target of net-zero emissions by 2070.
Battery swapping in India has taken off in the past five years through a confluence of technological advances and social and economic forces. Batteries have improved as their costs have fallen dramatically. Meanwhile, India has furiously built digital infrastructure and Indians have snapped up smart phones, allowing even some of the lowest-income people to tap into digital networks.
The Covid pandemic marked a major shift, a transformation I saw firsthand while reporting there in 2022. The pandemic crippled India’s economy for more than a year, but it also supercharged last-mile delivery services as mom-and-pop grocery stands and giants like Amazon alike expanded during what was, for a time, the world’s strictest lockdown. Individual drivers and companies with vehicle fleets started using two- or three-wheelers to deliver everything from groceries to mattresses.
Read the full article on Cipher’s website.