- By gkonele
- Nov 25, 2022
The Indian electric rickshaw market was worth $786.2 million in 2019 and is predicted to be worth $1,394.2 million by 2025, growing at a CAGR of 33.3% over the forecast period (2020–2025). Increasing government incentives to encourage the use of electric vehicles (EVs) and the implementation of severe environmental rules in response to increased worries about rising air pollution are driving market expansion.
Furthermore, factors such as rising end-user affordability, a cost advantage over auto rickshaws, higher daily earnings than cycle rickshaws, and increased manufacturer investments in the design and development of more cost-effective and affordable electric rickshaws are anticipated to benefit and boost the market in the forecast period.
The COVID-19 epidemic is projected to have a significant influence on the market's unorganised and local competitors. It is also projected that 30% of these manufacturers/assemblers will close their doors permanently after COVID-19. Sales are predicted to reach 2019 levels in 2022, with the market steadily rebounding after that.
Import challenges and the escalating India-China trade war will encourage domestic and in-house development of EV components in India in the coming years. Electric rickshaw prices are also projected to rise by 8-10% in the near future. Furthermore, due to the requirement for last-mile transportation of logistic commodities such as fruits and vegetables, the share of load carrier electric rickshaws is expected to grow significantly throughout the projection period.
Passenger carriers led the electric rickshaw market from 2014 to 2019 and are likely to maintain a bigger market share in terms of both value and volume in the coming years. This is mostly due to the country's expanding need for public transit for first- and last-mile connections. The rapidly growing urban population in the country is also driving the market for this category.
Historically, rickshaws with 1,000-1,500 W motor power generated the most revenue to the Indian electric rickshaw market, accounting for more than 50% in 2019. This can be attributed to the vehicles' optimal benefit-cost ratio. However, the market is likely to develop the fastest over the forecast period in the category of electric rickshaws with motor power greater than 1,500 W, as demand for rickshaws with higher speed and range continues to rise in the country.
The electric rickshaw market is further divided into rickshaws with battery capacities of 101 Ah and rickshaws with battery capacities greater than 101 Ah. Electric rickshaws with battery capacities greater than 101 Ah are predicted to expand quicker in the market throughout the projection period. The increased need for long-distance rickshaws that do not require regular charging is a primary growth driver for this market category.
During the historical period, the unorganised category dominated the market. The availability of low-cost electric rickshaws with less complex powertrains, as well as the absence of a regulatory framework, has aided the expansion of the market's unorganised, local companies
During the historical time, Delhi was the main market for electric rickshaws. Since 2013, sales of electric rickshaws have increased. In response to the capital's rising levels of air pollution, the Delhi government has now announced a $413 (INR 30,000) subsidy on the purchase of electric rickshaws. As a result, their demand in the city has increased, benefiting the market even more.
During the projected period, Uttar Pradesh is expected to be the largest electric rickshaw market in India, owing to increased demand for these rickshaws in Tier-1 cities, Tier-2 cities, and the rural-urban periphery. Furthermore, neighbouring states such as Bihar, West Bengal, and Assam have a high demand for these rickshaws.
The electric rickshaw business is quickly expanding, thanks in large part to the industry's unorganised, local operators. These unstructured players import vehicle components including motors, battery management systems, and axles and assemble them on the spot. Given the increasing need for these cars, particularly for last-mile connection, established Indian and foreign original equipment manufacturers (OEMs) have expressed interest in the industry in recent years. OEMs are progressively investing in economical and efficient electric rickshaws, and well-known automotive players are entering this market with the introduction of new electric rickshaw models. More such players are projected to enter the market in the coming years as their interest in the market grows, as does their ability to invest in product development and distribution network growth.
With increase in th demand of cost effective ransportation for first- and last-mile connectivity is a major growth factor for the Indian electric rickshaw market. For daily commuters, three-wheeler sharing service is considered as a potential economic and quick answer. Electric rickshaws emit no tailpipe emissions and are widely employed in cities around the country for first/last-mile connectivity. These three-wheeled electric cars also assist commuters in filling gaps in public transportation service. An electric rickshaw service costs $0.14 per head per kilometre (km) (INR 10).
If the rickshaw is shared with other users, this is the fare. If the rickshaw travels 5 kilometres, the price is approximately $0.21. (INR 15). With four passengers, the driver makes approximately $1.70 (INR 120) to and from the destination. As a result, electric rickshaws are the finest low-cost shared method of public transportation for last-mile connectivity in the country.
India is the world's third largest carbon emitter, accounting for around 6% of global CO2 emissions from fuel combustion. According to an IQAir assessment issued in 2019, India has 21 of the world's 30 most polluted cities. Furthermore, according to the 2018 World Health Organization (WHO) Global Air Pollution Database, 14 of the world's 20 most polluted cities are in India. As a result, the Indian government is increasingly focusing on giving incentives in the form of subsidies and tax breaks to make high-priced electric rickshaws accessible and to replace their traditional counterparts.