Electric Vehicle--Its Start, Its Present, and Its Future.

The Electric Vehicle Industry: Paving the way for a sustainable future.

 In our quest for a sustainable and environmentally conscious future, the electric vehicle industry (EV) has emerged as a catalyst for change.  This article discusses the inception of electric vehicles, the impetus for their growth, supply chain requirements, and associated challenges, key industry players, and recent developments that could shape the future of this industry.

 Historical Context:

The concept of electric vehicles can be traced back to the early 19^th century when inventors began considering alternative propulsion systems. However, the first practical electric vehicle wasn’t built until 1935. Over time many engineers and inventors refined the early technology and Gaston Plante’s creation of the first rechargeable battery in 1859 significantly improved the viability of electric vehicles. Electric vehicles gained popularity in the early 20^th century due to their ease of use, lack of noise, and reduced air pollution as compared to vehicles with internal combustion engines.

 The Need for Change:  

Today, rapid electrification of vehicles offers the most promising solution to greenhouse gas emissions from the transportation sector. Motor vehicles fueled by traditional fossil fuels are significant contributors to greenhouse gas emissions, the leading cause of global warming and climate change. The Intergovernmental Panel on Climate Change (IPCC) estimates that road transport contributes to 8.2 gigatons of carbon dioxide emissions, annually. Moreover, the International Energy Agency estimates that emissions from transport grew by 1.7% from 1990 to 2021, faster than any end-use sector. To achieve the goal of net zero emissions by 2050, a substantial reduction in carbon dioxide emissions from the transport sector is imperative.

 The Growth of Electric Vehicles:

Against the backdrop of growing concern around greenhouse gas emissions, electric vehicles have become more accessible due to recent advances in battery technology, improvements in charging infrastructure, and increased public awareness. According to the International Energy Agency, in 2022, more than 10 million electric vehicles were sold worldwide representing 14% of overall car sales. In comparison, electric car sales represented just 4% of the overall car market in 2020. Moreover, the sale of electric vehicles is expected to increase to 18% or 14 million vehicles in 2023. This shift to electric vehicles reduces reliance on fossil fuels, improves air quality, reduces noise levels in urban areas, and offers cost savings in the long term. Moreover, electric vehicles produce zero tailpipe emissions and are more energy efficient compared to vehicles with internal combustion engines.

 Supply Chain Dynamic and Challenges:

The supply chain for electric vehicles differs from the supply chain for traditional automotive: it includes battery production, manufacture of electric drivetrain components, manufacture of charging infrastructure components, as well as software development. Each aspect comes with its own unique challenges such as sourcing rare earth metals like lithium, cobalt, and nickel, used in the production of batteries, in a sustainable and ethical manner. The increasing demand for rechargeable batteries raises concerns about the environmental impact of mining raw materials. Electric vehicle batteries are also expensive to manufacture and have limited economies of scale. Additionally, the growing transportation volumes required for electric vehicles may pressure logistics players, including shipping lines, necessitating adjustments to operations. The manufacture of electric vehicles may also require adjustments to shipping routes or may require specialized storage and handling, especially for their batteries.

 Key Industry Players and Recent Developments:

Despite the challenges, there has been a significant impetus to ramp up the production of electric vehicles across the world. Established vehicle manufacturers and innovative startups have made tremendous contributions to electric vehicle technology. Tesla, led by Elon Musk, is synonymous with high-end, high-performance electric vehicles and the company has made pioneering innovations in battery technology. Nissan introduced the Nissan Leaf, one of the world’s best-selling electric vehicles. Established companies like Chevrolet, BMW, Volkswagen, and Hyundai as well as startups like Rivian, Lucid Motors, and NIO have introduced electric vehicles that offer a range of features, with many focusing on improving affordability. 

 Electric Vehicles in India:

In keeping with this worldwide shift, electric vehicles have also received significant attention in India. The government of India has introduced the faster adoption and Manufacturing of electric vehicles program (FAME II) with the aim of establishing manufacturing clusters, encouraging research and development, and providing financial incentives to accelerate the development and adoption of electric vehicles. India is also part of the global EV30@30campaign which aims for electric vehicles to contribute to at least 30% of total sales by 2030. India has signed an MOU with Australia to source critical minerals required for the production of electric vehicles. The government of India has also introduced tax rebates to encourage the purchase of electric vehicles. According to the Minister of Road Transport and Highways, Nitin Gadkari, these initiatives have yielded positive results, “sale of two-wheeler EVs rose by 422%, 3-wheelers by 75%, and 4-wheelers by 230% between 2019 and 2020.”

 The Indian electric market was worth almost US$ 1500 million in 2021 and is expected to grow to over US$15000 million by 2027. Tata Motors, with its Nexon EV, an all-electric compact SUV is at the forefront of manufacturing electric vehicles in India. Mahindra Electric has introduced vehicles like the Mahindra eVerito sedan and the Mahindra e2o plus hatchback. MG Motor India, Hero Electric, and Ather Energy are some other companies that have launched a variety of electric vehicles in India.  The push for adopting electric vehicles is also likely to give rise to ancillary industries and boost employment. Moreover, the increased demand for advanced batteries is projected to be a big economic opportunity for India.  India’s extensive adoption of electric vehicles also ties up with its climate-related goals of reducing carbon emissions by 1 billion tonnes by 2030 and sourcing 50% of its energy requirements from renewable sources. Notably, India relies on imports to meet 86% of its crude oil requirements. Moving to electric vehicles can positively influence the attainment of these goals.

 The recent growth of the electric vehicles industry demonstrates a collective commitment to a more sustainable future. By addressing challenges related to supply change dynamics, high costs, and ethical sourcing of materials, we can accelerate progress toward a cleaner and greener future.