Skoda-Volkswagen Executive Director Says India Is Not Ready For EVs: What He Actually Means

The automotive landscape in India is fast-evolving. The electric vehicle segment now posts slow-paced growth, and there is strong growth in hybrid adoption. These changing market winds have forced manufacturers to rethink their calls in EV and hybrid game plans. One such carmaker is Skoda Volkswagen India. Talking to Mint, Skoda Auto Volkswagen India's Executive Director (ED)-sales marketing & digital, Jan Bureš detailed the revised approach and also remarked that India isn't yet ready for EVs! There are more layers to this statement than what it looks like.

Skoda Volkswagen India is currently rethinking its EV projections for India. It had previously announced its intentions to capture market shares of up to 30 percent in the EV space by 2030.

It turns out that now the manufacturer is aiming for just 18% penetration by 2030- notably lower than the previous forecast. This sounds more realistic and achievable to most people who have been watching the space evolve. Interestingly, most analyst predictions point towards 13-15% EV penetration in the small car segment!

Now, let us come to the statement made by the ED. He said that the country lacks proper EV infrastructure, and there is still time left before the ecosystem grows to promising levels. He further adds that there isn't as much appetite for EVs as they had previously expected.

Bures also says that the people buying electric vehicles today are mostly cost-conscious buyers looking for low-cost alternatives to petrol cars. India, he says, doesn't have a high-aspiration EV segment. The ED explains that from a business perspective, the real scale will only come when the infrastructure develops to satisfactory levels, when the customer mindset evolves and more importantly when a good price can be pulled off.

'India isn't ready for EVs yet' doesn't however, mean that Volkswagen Group has taken its focus off electric vehicles completely. The ED confirms that they're running test vehicles under the Skoda brand, and carrying out various feasibility tests. As a company, they can't ignore the upcoming CAFE (Corporate Average Fuel Efficiency) norms. So, Skoda and Volkswagen EVs are definitely coming.

From what Bures has told the Mint, it seems safe to assume that Skoda Volkswagen will continue to have a strong focus on the premium segment, even in the case of electric vehicles. The company is also aware of the value-conscious nature of the India consumer. We'll have to wait till they launch their first EV to find out how these learnings bear fruits.

The ED also talked about the carmaker's larger plans with hybrid vehicles. Volkswagen Group used to be reluctant to foray into the hybrid space. It seems to be rethinking these decisions now. Bures has confirmed that various brand under VW Group will launch hybrids in the future. He went on to add that on personal grounds, he thinks 'it isn't the best use of consumer money'.

Hybrid cars have two separate systems- electric and the engine- mated to each other seamlessly. Bures sees this as a compromise on space and efficiency. Rolling out hybrids will help in (or let's say, 'is critical in') meeting CAFE norms. As a buyer, however, he says he would choose either an ICE (Internal Combustion Engine) or an EV.

The Indian government is currently considering to incentivize hybrids. Doing so will lead to more adoption, and to more people choosing hybrids over electrics. This could, in turn, slow down the infrastructure development and the growth of the EV sector.

For the end customers, however, a shift to hybrid vehicles could be advantageous. Hybrids can keep buyers safe from range anxiety, chaotic charging, and other EV-specific pain points.