India's share of electric bus sales in new bus sales are poised to double to about 8% in the coming fiscal, from 4% last year, according to CRISIL.
The ratings agency cites two main factors for the projection; government push for decarbonising public transport and lower overall cost of owning an electric bus, versus traditional combustion engine or CNG buses.
Government programs, like Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles and National Electric Bus Programme, have boosted e-bus procurement, with 5,760 buses delivered so far and 10,000 more planned for deployment, the ratings agency said in a report.
While favorable contracting terms have aided adoption, challenges like financial constraints of state transportation units and insufficient charging infrastructure persist, it said.
However, wider adoption hinges on state entities embracing this scheme. Currently, e-bus sales are mostly driven by government initiatives, with limited adoption in the private sector, which owns the majority of the country's bus fleet, CRISIL highlighted. Private sector accounts for 90% of the bus fleet in the country and their participation through policy changes is crucial for e-bus adoption, it said.
Looking ahead, monitoring policy changes, battery technology advancements, and the implementation of payment security mechanisms will be key, the report said.
“Growth in e-buses is also supported by favorable ownership economics. Total cost of ownership for e-bus is estimated to be ~15-20% lower than ICE and CNG bus, over an estimated life span of 15 years, with breakeven in 6-7 years," said Sushant Sarode, director, CRISIL Ratings.
Though the initial acquisition cost of e-bus is twice that of an ICE or CNG bus, costs will reduce on account of improving operational efficiency of original equipment manufacturers, with increasing scale and localisation and decreasing battery costs, he said.
RECOMMENDED FOR YOU
Lenskart Cuts Losses By 84% To Rs 10.15 Crore, Revenue Up 43% In FY24
Nov 06, 2024
India’s Home Textiles Sector Set For 6-8% Revenue Growth This Fiscal: Crisil Ratings Report
Nov 06, 2024
Boeing Launches $19 Billion Share Sale To Thwart Downgrade
Oct 28, 2024
Delhi High Court Seeks Centre's Response On Concert Ticket Resale Regulation
Oct 24, 2024
POPULAR