The focus in the automotive industry may be on electric vehicles, but sales of hybrids and CNG-powered passenger vehicles are also expanding quickly, exceeding industry growth. According to Jato Dynamics data, the share of hybrids in total passenger vehicle sales in India has increased from 8.13% to 11.5% in three years. CNG now accounts for 10.3% of new car sales, up from 6.4% three years ago.
Petrol is still the preferred fuel for up to 60% of consumers, with diesel coming in second at 16%. However, the proportion of the two fossil fuels in the overall mix is decreasing. Although electric vehicles are the fastest growing in terms of sales, they account for only 1.6% of the passenger vehicle market.
Adoption of electric vehicles is hampered by two factors: high acquisition costs and a lack of public charging infrastructure.
Hybrids, which employ both an electric motor and fossil fuel, alleviate consumer range concern while simultaneously being more environmentally sustainable and consuming less fuel than fossil fuel-powered vehicles. According to industry experts, their sales will continue to expand at a rapid pace. Hybrids also have high fuel efficiency and minimal operating costs.
According to a recent study conducted by the Engine Research Laboratory at IIT-Kanpur to evaluate the lifecycle emissions and total cost of ownership for battery electric vehicles, hybrid electric vehicles, and internal combustion engine vehicles available in India, battery EVs have a lower total cost of ownership than hybrids. However, this was mostly owing to lower taxation – battery EVs are taxed at one-tenth the rate of hybrids.
However, the analysis concluded that the existing lower taxes and subsidy schemes for battery EVs were unsustainable in the long run and will be phased out due to the enormous financial load on the government. Once an equal playing field is established, hybrids will be a cost-effective and environmentally friendly powertrain alternative. According to experts, this could have an impact on automakers’ production strategies.
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