Indian billionaire Rakesh Jhunjhunwala counts on automaker Tata Motors as one of the winners in India’s growing electric vehicle market.
“I think the biggest and best electric car player in India will be Tata Motors,” Jhunjhunwala told CNBC’s Street Signs Asia on Tuesday.
“I’m a major shareholder in Tata Motors. I play the EV story through Tata Motors,” said the investor.
He explained that the judging will ultimately not determine who will win the electric vehicle race. Instead, according to Jhunjhunwala, large companies with manufacturing and investment capabilities, sales channels, manufacturing experience, and the ability to design good cars will ultimately have the edge.
“I think it will be the Mercedes, the Volkswagen and the Tata Motors that will be the real winners in the electric race,” he said, adding that another factor that is required for success in India is ability Adapting the cars is for Indian road conditions – for example, the ability to drive these cars on flooded roads.
India is also a cost-conscious market where EV use is likely to be dependent on government incentives, the investor said. Infrastructures such as charging stations still have to be expanded in order to achieve broad acceptance. But, Jhunjhunwala said, India is “ready like any developing country, but I think the pace of readiness will increase like anything else.”
Both Tata Motors and competitor Mahindra & Mahindra already sell electric vehicles. American electric vehicle giant Tesla is reportedly preparing to open an electric car manufacturing facility in southern India.
The signage for Tata Motors was displayed at the company’s headquarters in Mumbai, India on January 27, 2018.
Dhiraj Singh | Bloomberg | Getty Images
Diversified financial services firm Motilal Oswal told CNBC earlier this month that the excitement in India’s electric vehicle market is coming from ancillary areas like battery manufacturing.
Among automakers, Maruti prefers Suzuki – India’s largest automaker – for its strong distribution network, though Maruti isn’t quite as optimistic about electric vehicles itself.
India is trying to both reduce its reliance on oil and improve its air quality. That should trigger a boost in electric vehicles.
Reuters reported last year that India has potential plans to offer $ 4.6 billion in incentives to companies setting up advanced battery-making facilities as part of its efforts to encourage the use of electric vehicles. The country previously approved a program to subsidize sales of electric and hybrid vehicles.
In this month’s annual budget for fiscal year beginning April 1, India announced a voluntary vehicle scrapping policy to remove old vehicles that contribute to the country’s poor air quality.