Swedish luxury carmaker Volvo aims to become an all-electric company by 2030 as part of its ambitious climate plan to consistently reduce its carbon footprint per car and become a climate-neutral company by 2040.
Speaking to Digitimes Asia, Jyoti Malhotra, MD of Volvo Car India, explained that they have similar plans specifically for India as the country rapidly transitions to electric vehicles. Early this month, Volvo Car India began delivering its first locally assembled luxury electric SUV, XC40 Recharge.
"In India, too, we are committed to this and have set an ambitious target towards moving to more than 50 percent of our total sales from electric cars by 2025," Malhotra said. "We have launched our first all-electric, the XC40 Recharge, in India this year and have committed that we will launch a new e-luxury model every year after that."
Improved market awareness
The EV market in India is evolving. The increasing technology acceptance by the Indian customer is visible in the growing numbers of green number plates on Indian roads across all categories of EVs. The Ministry of Road Transport and Highways estimates that in August 2022 alone, there were 13,92,265 EVs on Indian roads, which continues to grow.
"There are many factors that are driving this demand," Malhotra said. "Customers are now seeing investments in public charging stations take shape, and this is building confidence. Manufacturers have dispelled the misconception that EVs are suitable only for short distances by informing potential customers about the true range coverage per charge. We have committed that our all-electric offering, the XC40 Recharge, has a range of 400 plus kilometers per charge."
More and more Indian consumers are well-informed on technological advancements, economic challenges, and environmental concerns, prompting a switch to EVs. While the EV business is still nascent, it is gaining traction rapidly. Malhotra said that with active market investments and promotion, the EV industry is expected to surpass 90 lakh units annually by 2027.
Embracing digitization to reach customers
The EV industry has made remarkable growth in many markets worldwide, but it's a relatively recent phenomenon in India. But Malhotra suggests that the Indian consumer is very aware and tech-savvy, which makes the market ready to make informed purchase decisions when opting for an EV.
"The luxury e-mobility customer is well informed and is aware of the benefits of EVs," Malhotra said. "This, combined with the trust that the customer places in the brand Volvo, resulted in us getting pre-orders of 150 XC40 Recharge cars within a few hours of opening online bookings. This shows the level of awareness that the luxury e-mobility customer has."
The company believes that digitalization is the way to go. With the XC40 Recharge, Volvo took a digital-only approach, allowing only online bookings. The company says it has seen a significant increase in interest and purchases after switching to digital bookings.
"Also, the XC40 Recharge owners get membership of the exclusive Tre Kronor program," Malhotra said. "Tre Kronor membership offers benefits and services designed for Volvo car owners, keeping their satisfaction and comfort in mind. Volvo Tre Kronor Experience Program provides owners with a specialized Volvo relationship manager, doorstep solutions for some specific services, complimentary pick-up and drop-off of automobiles for service-related needs, and much more."
Challenges in the Indian EV market
The biggest challenge that EV manufacturers face across vehicle segments and price points is consumer misconceptions regarding the range of an EV per charge. Manufacturers have now started giving clear information on the capability of batteries to cover reasonable distances on a single charge.
"Our XC40 Recharge, for example, gives over 400 kilometers per charge," Malhotra said. "However, as a country, the biggest challenge would be to ensure that all the EVs that will start plying on roads are charged by using renewable energy sources like solar and not by using power from the grid. We've had several customers tell us that they'd like to get solar charging but don't know how or whom to contact."
Through its program, Volvo identifies a customer's region and assists them in installing solar panels with the help of an agency they have designated.
"As a result, we are doing our part to ensure green electrification and hope that all stakeholders will work together to address this situation," Malhotra added.
The Indian EV market is heating up with more large companies entering. For customers, the ecosystem is the main deterrent at the moment. Concerns about the availability and efficiency of charging points limit their adoption. If this issue is taken care of, India will see a faster transition to EVs.