Explainer: Is this the right time to buy an EV?

The story of electric vehicles (EVs) in India has long been about 'future potential', a promise that has been postponed on account of high ownership costs and the fear of range anxiety. But something is distinctly shifting in the automotive landscape. The conversation is moving from a distant dream to an immediate, hard-nosed question of economics and feasibility. So, for the discerning Indian buyer looking at their next big-ticket purchase, the crucial question remains: is now the right time to make the electric plunge?

The coming convergence: Gadkari’s big promise

The most compelling recent development has been the strong assertion from Union Minister Nitin Gadkari. He laid down a specific deadline of achieving price equivalence of Electric Vehicles with their Internal Combustion Engine (ICE) competitors within the next four to six months. This is a bold forecast that hinges largely on the dramatic decline in battery costs, which typically account for nearly 50-60 per cent of an EV's total cost.

(Also read: Gadkari says EV–ICE parity is months away. The Math says otherwise)

The government's initiative, including the FAME-II policy, PLI initiatives for domestic battery production, and the much lower 5 per cent GST charge on EVs (as against much higher on ICE cars), is giving a strong boost to the electric upsurge. If this prediction of price convergence materialises, the single biggest hurdle for mass EV adoption in India, the prohibitive upfront cost, will be shattered. The move would instantly make EVs a more practical and cost-effective choice for a wide swath of the market.

The financial arithmetic: Beyond the showroom price

Even as we wait for the predicted price parity, the financial case for an EV is already strengthening on the cost-of-ownership front. For the average daily commuter, the lower running costs of an electric car offer clear, long-term savings. The cost of 'fuel' - electricity, is a fraction of petrol or diesel, a critical factor for a nation still grappling with a massive annual fuel import bill.

Furthermore, the recent GST cuts on small ICE cars, while bringing some relief to the traditional segment, have only slightly narrowed a massive differential. The favourable GST structure for EVs, coupled with state-level subsidies and tax exemptions on loans for electric vehicles, continue to tilt the Total Cost of Ownership (TCO) firmly in the EV's favour, especially over a typical five-year ownership cycle.

(Also read: EV batteries can outlast an internal combustion engine-powered car’s lifespan: Study)

Easing range anxiety and infrastructure confidence

For a considerable period, the specter of 'range anxiety' hung over the sector. This reluctance, especially among non-metro buyers, is now being tackled methodically. There is a strategic rollout of charging facilities, focused not only in metros but also along the critical national highways through public-private collaborations.

Additionally, technology has also come a long way. While models like the MG Comet EV and Tata Tiago EV are suited for the city run around with limited range, several new models and battery technology guarantee decent ranges that will make the occasional long trips feasible. The arrival of such biggies such as Maruti Suzuki (with its e Vitara launch) and the enlarged EV offerings from Mahindra BE 6 and XEV 9e, Hyundai (Creta EV), and Tata Motors are providing buyers with a greater selection and bringing much-needed manufacturer credibility into the space.

A measured optimism

So, is this the right time? The answer, for the urban and semi-urban buyer, is a qualified yes.

The market is no longer a niche for early adopters. It is transforming into a mainstream segment backed by clear, consistent government policy and a surge in domestic manufacturing. If you have stable parking with home charging, your usage is primarily urban, and you are looking for long-term savings, the time to buy has never been better.

For the more cautious buyer who covers extensive inter-city distances, perhaps a brief pause, no more than six months, may be warranted. Waiting could allow you to capitalise on the predicted price parity and the even greater product range from manufacturers. The shift is already underway, but the window to catch the revolution right at its most affordable and technologically robust point is opening now.