Car News News

Maruti Suzuki postpones WagonR Electric for India?

Nizam Shaikh
Written by Nizam Shaikh

Maruti Suzuki has been testing their WagonR based small electric vehicle and is expected to be fully ready next year. The company has developed an electric vehicle, but has stopped short of launching it in the Indian market. According to a media report, the car giant has indicated that its plans to launch the vehicle could have been changed based upon the current market trends, high manufacturing cost of the EV as well as lack of charging infrastructure.

The WagonR electric can cost as much as INR 12 lakh which may be far beyond the reach of the common small car buyer. For comparison, the petrol powered version of the same car is priced between INR 4.70 lakh to INR 5.20 lakh (ex-showroom, Delhi), this initial high cost is the reason maximum buyers will be repelled, and does spending the extra INR 4 to 5 lakh justify in fuel costs?

Apart from the price, there are other issues as well. One being lack of charging infrastructure, as India has only 350 charging stations as compared to over 2 lakh charging stations in China. The private buyer will face many issues due to lack of charging stations while on the road. In India, at least in the urban environment, the cars are generally parked outside and away from one’s residence and potential customers may find it difficult to charge their EV outside on the road.

In terms of taxation, the electric vehicles benefit from low GST rate which is set at 12% as compared to 28% on the internal combustion engine cars but more incentives to the private consumer are required to push sales of the electric vehicles. Under phase two of the FAME (Faster Adoption and Manufacturing of Electric vehicles) scheme, growth is mainly dependent on fleet car owners and there are no incentives for the private customers. Many developed economies have already incentivized private customers, even when they have a higher purchasing power.

Hyundai is also planning to launch its Kona electric SUV soon in India. The car is likely to be targeted towards fleet car owners and for the private consumer Hyundai is expected to launch a hybrid version of the Kona. Like Maruti Suzuki, many car manufacturers are facing the same obstacle.

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