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EV Price Trends in India

  • Author :
  • TATA AIG Team
  • Published on :
  • 07/12/2023

You have probably heard of Electric Vehicles (EVs) by now. They are the vehicles that run on electricity instead of fossil fuels and are touted to be the future of transportation.

EVs are good for the environment and your wallet, as they can save you on fuel and maintenance costs. They are also crucial for India's energy independence, as they can reduce dependence on oil imports and increase the planet’s renewable energy share. EVs are also a key driver of economic growth, as they can create new jobs, industries, and markets.

But how much do EVs cost in India, and what are the factors that influence EV price trends? Let’s find out in this article.

Factors Affecting the Electric Vehicle Price in India

The following factors influence the electric vehicle cost.

Battery Cost

The battery is the most expensive part of an EV. It stores the electricity that powers the car. The cost of batteries depends on the type, size, and quality of the battery. Batteries also need to be replaced after a certain period. The electric car battery cost is expected to decrease as technology improves and demand increases.

Government Incentives

The Government of India wants to promote the use of EVs in the country. It has announced various incentives and policies to make EVs more affordable and accessible.

Economies of Scale

The more EVs are produced and sold, the lower the cost of production becomes. That is because the fixed costs of manufacturing, such as machinery and labour, are spread over more units. This can reduce the electric car price and make them more competitive with conventional cars.

Technology

The technology of EVs is constantly evolving and improving. New technologies can make EVs more efficient, reliable, and safe. They can also increase the performance, range, and lifespan of EVs.

Government Policies that Affect EV Prices in India

FAME Scheme

Short for Faster Adoption and Manufacturing of Electric Vehicles, this scheme provides financial incentives to EV manufacturers and buyers.

The scheme was launched in 2015 and has been extended till 2024. It offers subsidies on the purchase of EVs, ranging from ₹10,000 to ₹1.5 lakh, depending on the type and size of the vehicle. The scheme also supports developing charging infrastructure and public transportation using EVs.

PLI Scheme

The Production Linked Incentive scheme encourages the domestic production of batteries and other advanced components for EVs.

The scheme was launched in 2021 with a ₹18,100 crore budget. It offers incentives to battery manufacturers based on their sales and performance, aims to reduce the dependence on imports, and lowers the cost of batteries.

GST Rate Cut

This policy reduces the tax on the sale of EVs. The Goods and Services Tax is a uniform tax that applies to all goods and services in India. The GST rate on EVs was reduced from 12% to 5% in 2019 under this policy.

State-Level Subsidies

These policies benefit EV buyers in different states. Some states, such as Delhi, Maharashtra, Tamil Nadu, and Kerala, have announced their own EV policies that offer incentives such as exemption from road taxes, registration fees, parking fees, and toll fees for EVs.

Best Electric Cars in India and their Price

The cost of electric cars of some popular models, along with their features, are as follows:

Tata Tiago EV

This is one of the most affordable EVs in India, starting from ₹8.69 lakh. On a full battery, it can travel up to 213 km and reach 100 km/h from a standstill in 9.9 seconds. It has a 7-inch touchscreen for entertainment, dual airbags for safety, ABS with EBD for braking, and rear parking sensors for convenience.

Mercedes-Benz EQS

This is India's most luxurious and expensive EV, costing ₹1.59 crore. It is a full-size sedan that offers a range of 770 km when fully charged and can rush from 0 to 100 km/h in 4.3 seconds. It also boasts a 56-inch hyperscreen display, a Burmester sound system, a panoramic sunroof, and a 360-degree camera.

Tata Nexon EV

This is India's most popular EV. It is a compact SUV that costs ₹14.74 lakh and offers a range of 312 km on a single charge. It passes 0 to 100 km/h in 9.6 seconds and has features like a 7-inch touchscreen infotainment system, a sunroof, automatic climate control, and hill ascent and descent assist.

Mahindra XUV400

This is the latest EV from Mahindra, launched in October 2023. It is a mid-size SUV that costs ₹15.99 lakh and offers a range of 350 km on a single charge. It touches 0 to 100 km/h in 8.5 seconds. XUV400 notable features are a 10.25-inch touchscreen infotainment system, a digital instrument cluster, a sunroof, and six airbags.

Hyundai Ioniq 5

This is the first EV from Hyundai in India, launched in November 2023. It is a crossover that costs ₹45.95 lakh and offers a range of 480 km on a single charge. It can cross the speed of 100 km/h in 5.2 seconds. Ioniq 5 also features a head-up display, a 12.3-inch touchscreen infotainment system, and adaptive cruise control.

Kia EV6

This is the second EV from Kia in India, launched in September 2023. It is a crossover that costs ₹60.95 lakh and offers a range of 510 km on a single charge. It features a 14-speaker Meridian sound system, a panoramic sunroof, and blind spot monitoring.

MG ZS EV

This is the first EV from MG in India, launched in January 2020. It is a compact SUV that costs ₹22.88 lakh and offers a range of 419 km on a single charge. It surpasses the speed of 100 km/h in 8.5 seconds and has features like an 8-inch touchscreen infotainment system, a sunroof, a PM 2.5 filter, and a rearview camera.

BYD Atto 3

This is the first EV from BYD in India, launched in August 2023. It is a hatchback that costs ₹33.99 lakh and offers a range of 450 km on a single charge. It has a 10-inch touchscreen for infotainment, a digital instrument cluster, a sunroof, and a reverse parking sensor as its features. It can go past 100 km/h in 7.9 seconds with its acceleration.

Volvo XC40 Recharge

This is the first EV from Volvo in India, launched in June 2023. It is a compact SUV that costs ₹56.90 lakh and offers a range of 418 km on a single charge. It has a 9-inch touchscreen, a Harman Kardon sound system, a 360-degree camera, and a panoramic sunroof. In only 4.9 seconds, it can reach a speed of 100 km/h from 0.

Volvo C40 Recharge

This is the second EV from Volvo in India, launched in July 2023. It is a coupe SUV that costs ₹62.95 lakhs and offers a range of 420 km on a single charge. It touches 100 km/h in 4.7 seconds and has features like a 9-inch touchscreen infotainment system, a Harman Kardon sound system, and a 360-degree camera.

Conclusion

The government and manufacturers are both doing everything possible to make EVs more affordable without compromising on the safety features and the aspects that influence performance. However, there is a long way to go to make EVs dominate conventional vehicles.

Even if the prices of EVs are reduced significantly, their demand can increase only when there are significant numbers of charging stations in the country. Moreover, most EV spare parts are imported. This not only makes the car costly but also raises the ownership cost of the vehicle.

With high repair costs, it is strongly advised to buy car insurance along with an EV to ensure the vehicle is well-protected against financial damage. Motor insurance is a must-have to drive legally on Indian roads. It covers damage and loss caused by riots, earthquakes, fires, and theft. Insurance for a car also pays compensation in case of third-party injury or damage to someone else's property.

If you are yet to purchase insurance or are looking for car insurance renewal online, you can visit the Tata AIG website, enter your car’s details, pay the premium, and get covered within minutes.

FAQS

What factors contribute to the pricing of EVs in India?

The cost of EVs in India depends on factors like the type of battery used, how far the EV can travel on a single charge, the brand, and government policies.

What is the current price trend of the EV market in India?

With advancements in technology, increased production, and growing demand, the trend suggests a possibility of decreasing EV prices in the future.

How do battery costs impact the prices of electric vehicles in India?

Battery costs significantly contribute to the overall price of EVs. Advancements in battery technology have a direct impact on EVs. The better the battery, the higher can be the car’s cost.

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