Updated analysis of incentives for electrifying India’s four-wheeler ride-hailing fleet
This follow-up to a 2019 ICCT study re-evaluates the 5-year total cost of ownership (TCO) of four-wheeler battery electric vehicles (BEVs) used for ride-hailing and compares the results with comparable conventional gasoline, diesel, and compressed natural gas (CNG) vehicle models in 2020. In this update, the authors selected the Mahindra eVerito D2, the latest variant of the same make and model of BEV that was included in the 2019 study, and another BEV, the Tata Nexon, which is currently among the most popular four-wheeler BEVs in India. In addition to the cities of Delhi and Hyderabad, Bangalore city is also included in this analysis. These three cities are among the top markets for ride-hailing four-wheelers in India and they have the highest shares of BEV four-wheelers when compared to other cities in the country.
Results show some promising improvement in the attractiveness of electric ride-hailing cars. With the current cost and incentive structures and without considering any additional incentives, the BEV Mahindra eVerito D2 is cheaper than the comparable diesel and gasoline cars across all three cities in terms of 5-year TCO and thus cost per kilometer. For the BEV Tata Nexon, the per-kilometer cost is only marginally higher than the comparable diesel and gasoline cars in Hyderabad and Bangalore, and it is lower in Delhi. When considering the effects of some additional incentives on top of the existing cost structures, the cost differentials between the BEVs and conventional fuel vehicles decrease further from the baseline case across Delhi, Hyderabad, and Bangalore. Further, the average base price of the latest variant of Mahindra eVerito D2 dropped by 16% between 2019 and 2020, while the range of the vehicle increased by 29%. This reduction in base price contributed to a 34% decrease in cost per kilometer in Delhi and a 20% decrease in cost per kilometer in Hyderabad (figure).