Contributing 7.1 percent of Indian GDP and 49 percent of the GDP generated by manufacturing, India’s auto industry is among the fastest-growing in the world. India is also the fourth-largest auto market globally and is projected to be the third most significant in sales volume by the end of FY26. While the auto industry was most vulnerable to disruption in the outbreak, it has rebounded slowly. With the renewed focus of India on cutting carbon emissions following the United Nations Framework Convention on Climate Change (COP 27 Summit), the automotive industry has morphed rapidly, passing through ebbs, flows, and peaks in a short time.
After an emotional rollercoaster in the mobility sector, it has drastically changed from half ten years earlier. It’s unsurprising that 2022 was a resurgence year for companies across all sectors, and the mobility industry isn’t an exception. It was a year full of the evolution of learning, growth, and development for the industry that plays a vital part in our daily lives. This is how the nature of the business has developed on all levels.
It is the rise of the EVs
The concept of electric automobiles (EVs) aren’t an entirely new idea. In reality, electrical vehicles were in use since the beginning of time, i.e., since the 1870s. But it has been over the last 10 years that EVs have been gradually becoming more sought-after. With the growing risk of global warming and climate change increasing the number of people who are conscious of their lives and how it affects our world.
One of the primary factors that contribute to air pollution across the United States, car emissions can contribute between 20 and 30 percent of particulate matter that is at the level of breathing quality. In addition, about 8 percent of Greenhouse gas Emissions come from the transport sector, and passenger cars contribute around 45 percent of CO2. This leads to poor air quality that affects not just breathability but our health, but also pollutes the earth. These disturbing facts have encouraged people to consider EVs and government officials to push their use.
In the month of October, 2021, the Indian government announced a goal of 2030 when 30% of all vehicles used on Indian roads should be electric. From an economic standpoint the possibility is that when EVs grow to 40 percent in the two-wheeler as well as four-wheeler segments, and 100 percent on buses India is able to cut down on crude oil consumption by of 156 million tonnes, which is worth the sum of INR 3.5 million crore. To make sure we meet the goals, the government has been rapidly expanding the electric vehicle infrastructure. It is also offering incentives to those in the EV sector and to consumers who purchase EVs with programs such as FAME India (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles).
All of these have helped increase EV use across the nation while, even though EV infrastructure in the country has much to be done but it has grown exponentially in a short time. In order to put it in perspective 2022 saw the registration of nearly twice the amount of EVs in comparison to 2021. Between June and April 2022, India witnessed a 68 per percent rise on EV adoption, and received the much-needed approval from consumers. In the present, EVs have become increasingly prevalent on our roads and this trend is likely to increase in popularity over the next few years.
Moving towards shared or car rental mobility
The per capita income as well as purchasing power have increased in recent years, and with more people having money to spend, the notion of owning a vehicle has changed. A car is an amazing thing, however it does come with its own setbacks. In particular there are added costs and limited transferability. Maintenance and insurance expenses have increased and that’s not even including the commitment you will have to provide to a car for at least 4-5 years.
In addition, with the spread of the pandemic creating fear among people about public transport, driving is becoming more popular with people looking for self-drive alternatives. That’s where the rental vehicle segment comes in. With a projected annual revenue in the range of 2.63 billion by 2023, India’s rental car sector is seeing a surge.
With the latest technology, such as keyless entry systems as well as safety features, rental cars give customers a sense of ownership, without the obligation aspect.
Mobile connectivity is the way of the future
Similar to other industries technology is among the key elements that drive the mobility industry. It is a major factor in the business and connected mobility is growing in popularity. While connectivity was confined to phones and infotainment systems for automobiles, the ease of use and convenience it brings has gained it a massive following among users. To meet their needs industry players are making use of technologies like AI blockchain, IoT, and 5G to offer customized services. These technologies are also crucial when it comes to providing security, which is one of the aspects customers consider when leasing or purchasing the car. In essence connected mobility will be the new norm in this market and is likely to witness a rise in connected vehicles.