India’s ambitious plan to push electric vehicles at the expense of other technologies could benefit Chinese car makers seeking to enter the market, but is worrying established automakers who have so far focused on making hybrid models.
India’s government think-tank, NITI Aayog, unveiled a policy blueprint this month aimed at electrifying all vehicles in the country by 2032, in a move that is catching the attention of car makers that are already investing in electric technology in China such as BYD and SAIC.
The May 12 report by the Aayog, recommends lower taxes and loan interest rates on electric vehicles while capping sales of petrol and diesel cars, seen as a radical shift in policy. India also plans to impose higher taxes on hybrid vehicles compared with electric, under a new unified tax regime from July 1, upsetting car makers like Maruti Suzuki and Toyota Motor.
The prospect of India aggressively promoting electric vehicles was a “big opportunity,” a source close to SAIC, China’s biggest automaker, told Reuters. “For a newcomer, this is a good chance to establish a modern, innovative brand image,” the source said, although they added the company would need more clarity on policy.
Earlier this year SAIC set up a local unit called MG Motor which is finalising plans to buy a car manufacturing plant in western India. Warren Buffett-backed BYD already builds electric buses in the country, while rival Chongqing Changan has said it may enter India by 2020.
