Prime Minister Narendra Modi’s administration is aiming to have more than 30 percent of vehicles run on electricity by 2030 in a bid to lower air pollution and curb reliance on fossil fuels.
Cheap fossil fuel-driven cars and an absence of state subsidies for electric vehicles make purchases by the government and companies critical for EV sales, according to BNEF, which expects EVs to comprise about 7 percent of sales in India by 2030.
“These tenders are the largest drivers for EV demand” during the next three to five years, according to Allen Tom Abraham, a BNEF analyst in New Delhi. “If these large procurement programs falter, auto-makers would prolong any plans they have to introduce mass market EVs in India.”
Tata Motors and Mahindra & Mahindra, which had emerged winners in EESL’s first tender for electric cars, didn’t immediately respond to requests for comment.
The government agency issued a second tender for 10,000 cars earlier this year.
“I have demand for 19,000 cars today and if I don’t get more, there won’t be a third tender,” Kumar said.