Tata and MG's free charging strategy set to attract EV buyers

In India, the electric vehicle market is experiencing a period of strategic manoeuvring as top manufacturers employ various tactics to stimulate sales and overcome market challenges. This shift comes as the EV sector, which has seen rapid growth to capture 2 per cent of India's annual car sales of 4.2 million units, faces a slowdown in sales momentum.

Tata Motors, India's leading EV manufacturer, has taken aggressive steps to attract consumers. The company is offering significant incentives, including free charging at 5,500 stations operated by its power unit for six months.

Tata has implemented substantial price reductions ranging from 10 per cent to 20 per cent on its popular Punch and Nexon models. These price cuts are particularly noteworthy as they bring the cost of the best-selling Nexon EV to approximately USD 15,000, making it comparable in price to its gasoline and diesel counterparts. Tata Motors has framed these initiatives as a "step towards mainstreaming EVs and accelerating EV adoption."

Meanwhile, MG Motor, a joint venture between India's JSW Group and China's SAIC, has introduced an innovative approach to EV ownership. The company has launched the world's first "Battery-as-a-Service" plan for its new EV model. This service allows customers to rent the battery, typically one of the most expensive components of an electric vehicle, rather than purchasing it outright. The plan is designed to make EVs more affordable by reducing the initial acquisition cost. Under this scheme, customers pay for battery usage at a rate of INR 3.5(4 U.S. cents) per kilometre, with a monthly minimum requirement of 1,500 kilometres (932 miles).

Satinder Singh Bajwa, chief commercial officer of MG Motor, emphasised the affordability aspect of this approach, saying, "You are paying for the usage of the battery as you pay for the fuel." This strategy aims to address one of the primary barriers to EV adoption in India – the high upfront cost of electric vehicles compared to traditional internal combustion engine vehicles.

The need for such innovative strategies is underscored by recent sales figures. Tata Motors, for instance, sold only 4,086 EVs in August, marking a nearly 15 per cent decline compared to the same period last year. This represents the fourth consecutive month of year-on-year decline in EV sales for the company in India's auto market, which is the third-largest globally.

These efforts by manufacturers come against a backdrop of challenges facing the Indian EV market. Despite the government's push to promote clean vehicles, the widespread adoption of electric cars has been hampered by factors such as high prices and a lack of charging infrastructure. While e-scooters have seen significant uptake, particularly driven by demand from e-commerce companies, annual sales of electric cars in India remain below 100,000 units.

The preference for gasoline and diesel vehicles among Indian consumers persists, largely due to the scarcity of charging stations across the country. This infrastructure gap continues to be a significant hurdle for EV adoption on a larger scale.

Despite these challenges, various international and domestic automakers continue to enter the Indian EV market. Companies such as BYD, BMW, and Mercedes-Benz have launched their electric models, often targeting the growing segment of affluent Indian consumers.

MG Motor's latest offering, the Windsor EV, exemplifies the efforts to appeal to a broader range of buyers. Priced at INR 999,000 (USD 11,900), the vehicle comes with attractive features including a panoramic glass roof, reclining rear seats, six airbags, and complimentary charging at numerous stations for the first year.

These developments in the Indian EV market reflect the industry's recognition of the need to address key barriers to adoption, particularly cost and infrastructure concerns. As manufacturers continue to innovate and offer more attractive propositions to consumers, the evolution of India's EV landscape will be closely watched by industry observers and policymakers alike.