Increasing popularity of EVs threatening Big Oil profits

Can India’s 2030 EV target turn from ‘aspiration’ into reality?

  • Govt. keen to back only EVs, not hybrid vehicles
  • Only 222 charging stations across India severely hampering EV sales
  • Global plans to phase out conventional cars forcing Big Oil to invest in renewables instead

Only electric vehicles (EVs) will be sold in India by 2030, and there will be no support for hybrid vehicles in the interim – that is the message by the government.

However, EV sales are at a mere 1% of total vehicle sales in India at the moment, which makes the deadline seem highly ambitious.

This is because lithium-ion batteries – which contribute to nearly 60% of the cost of EVs – are expensive to make, and are mostly imported from China, which commands about 55% of global li-ion battery production.

What’s also keeping buyers away is the presence of very few charging stations, only 222 all over India, and their fear of getting stranded is real.

The situation is improving though, as Tata Power has announced plans of setting up 1000 charging stations in Delhi. The government has also floated a tender to acquire 10,000 electric cars and 4,000 charging stations for certain ministries to boost EV uptake.

The government is also considering the standardisation of EV charging infrastructure, introducing swappable battery packs and improving public transport to cut emissions. A shift to e-mobility could save India nearly $60 billion in oil import bills annually.

Threat to oil companies?

Oil companies, however, could be staring at significant drop in revenue, as four other countries have announced their deadlines to phase out conventional cars: Norway (2025), Germany (2030), and France and the U.K. (2040). In fact experts say traditional cars will not disappear only because of climate concerns, but also because electric cars are both cheaper and safer.

Several of the biggest oil firms are therefore beginning to diversify, and are investing billions into wind farms, solar power stations and EV charging stations instead.

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