EV sales and two-wheelers likely to see positive growth: Nomura Research Institute

The Indian auto industry is expected to record stronger growth in 2020-21, after recovering from the devastating effects of COVID-19 pandemic, with electric vehicle (EV) sales and two-wheelers likely to see positive movements, says Nomura Research Institute (NRI) Consulting & Solutions India.

Ashim Sharma, partner and group head (business performance improvement consulting-auto, engineering and logistics) at NRI Consulting & Solutions India, believes the auto industry will see stronger growth in 2021-22. “As far as personal vehicles are concerned, the 2018-19 levels would be reached only in the 2022-23, whereas for two-wheelers, it will be achieved maybe a year after that,” he said. “This is also on account of some price hikes expected with introduction of new regulations.”

In regards to EVs, Sharma observed that 2021-22 would also see positive movements, especially in the two-wheeler EV segment, with new players like Ola Electric getting into the fray. “In addition, on the EV components side, we could finally see cell level manufacturing starting off in India with technological collaborations focusing on cutting-edge technologies such as LTO (lithium titanium oxide) batteries,” he said. LTO batteries, Sharma explained can be fast charged at high temperatures. It can last for 10,000-plus cycles and other enhanced chemistries like NMC811, which is a cathode composition with 80 per cent nickel, 10 per cent manganese and 10 per cent cobalt.

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“We could see a wider participation by local component players, and also the entry of some new players especially to cater to the rise in domestic EV two-wheeler and three-wheeler demand,” he said. “In addition, export opportunities for EV components as well as batteries could certainly emerge for domestic players as the world struggles to find alternative sources for supply chain resilience.”