NEW DELHI : Most fleet operators in India are unwilling to pay a premium of more than 20% for an electric variant of a vehicle compared to the cost of one running on an internal combustion engine, according to a survey conducted by Maruti Suzuki India Ltd.

Fleet operators would also prefer the vehicles to be fully charged within 45-60 minutes and have a range of 150-200km on a single charge in on-road conditions. The survey of 30 big customers in India, including Ola, Uber and Zoomcar, was carried out to understand their expectations about operating electric vehicles.

While higher cost of electric vehicles and inadequate charging infrastructure remain the biggest barriers for greater adoption, with battery costs dropping steeply as production scales, electric vehicles are expected to gain popularity among fleet operators.

A significant share of the total sales of Maruti Suzuki, which is expected to launch its first electric vehicle in 2020, comes from cab aggregators and commercial fleet operators. The company wanted to maintain its dominant position in the commercial segment through its electric vehicles in the decades ahead, two people aware of the development said, requesting anonymity.

An email sent to Maruti Suzuki on Monday did not elicit a response.

The company had in December 2017 said that it would conduct a survey to gauge customers’ expectations from electric vehicles.

“It is quite obvious from the survey that cab aggregators wouldn’t want to pay a substantially higher price than that of a traditional vehicle and there should be no range anxiety since that would impact their business," said one of the two people cited earlier.

According to estimates of researcher IHS Markit, around 12% of the new vehicle sales in India by 2030 will be generated by taxi aggregators, which justifies Maruti’s focus on the needs of commercial fleet operators.

“Most fleet owners will not want to pay more than what they pay now. The 15-20% premium is also because the operational cost is comparatively low. Otherwise, no one would want to pay a penny more for electric vehicles in the commercial segment," said the second person. “Also, cab aggregators need simple but efficient vehicles with good mileage."

The next wave of growth in the automobile sector in the couple of decades ahead will come from shared mobility and electric vehicles, according to Puneet Gupta, associate director (vehicle sales projection) at IHS Markit.

“Maruti being the undisputed leader in commercial channel sales will try to know what their big fleet customers expect to maintain their leadership position in the coming decade," Gupta said. “In fact, the new product development process of the company has been designed keeping in mind different aspects of shared mobility and the needs of retail customers. In the future, shared mobility will be a big chunk of new vehicle sales and none of the companies wants to walk away from the segment."

Parent Suzuki Motor Corp. has started testing 50 units of the electric variant of its popular hatchback Wagon R in India that is set to be launched in 2020.

Cab operators are concerned about the on-road running capacity of the vehicles, according to the second person. The concern is more about the vehicle being able to run more than 150km in extreme traffic conditions, when a lot of clutch and brake use comes into play.

Suzuki has begun testing an electric variant of its Wagon R.
Suzuki has begun testing an electric variant of its Wagon R.