6 Challenges Faced by EV Makers to Market Their Products in India in 2022

6 marketing challenges faced by EV makers

Here is an analysis of 6 EV marketing challenges that are hindering the adoption of electric vehicles on Indian roads. 

Electric Vehicle is the new buzzword in the automobile industry. The demand for EVs has seen a push as people are now more conscious of a clean and emission-free environment. When you are on the road, you will be able to see a few EVs alongside conventional Internal combustion engine (ICE) vehicles.

The Government of India is giving additional push for EVs

As per a statement by the Ministry of Power, India is aiming to achieve 30% electrification by 2030. A study conducted by the Centre for Energy Finance in 2020 estimates that the Indian EV market is set to become a $206 billion opportunity by the year 2030. Various state governments such as Karnataka and Tamil Nadu are formulating investor-friendly policies to make a shift towards clean mobility.

How well do the Government of India supports EV adoption

This is why we see more and more automakers betting big on clean mobility in India. Brands like Ola electric, Ather Energy and Hero Electric are manufacturing two-wheeler EVs. Tata Nexon EV has been the best-selling car in the electric segment since its launch. Other players like Mahindra & Mahindra, Mercedez-Benz India and Audi India are all making huge investments to ramp up their sales.

The marketing strategies of these brands are focused on bringing a change in consumers’ thought processes while buying an automobile. Their target is to make electric vehicles mainstream. However, the makers of EVs in India face certain challenges while marketing their products. The pace of adoption has been low due to inhibitions in consumers’ psyche.

Let us look at 6 challenges that have to be taken into consideration while making marketing strategies by EV makers.

6 EV Marketing Challenges in India

1. Educating the target customers to bring EVs to mainstream

Brands that are selling EVs have a clear agenda of shifting consumption patterns among consumers. This means that they need to create awareness and educate customers about the features of EVs. To do so, brands have leveraged their presence on digital platforms by creating content to educate and dispel myths around EVs. The current challenge is to find the best marketing mix to build awareness and bring EVs to consumers’ consideration set.

2. Insufficient charging infrastructure

Charging infrastructure in India is still at a nascent stage. According to Central Electricity Authority, there are a total of 934 public charging stations across all Indian states as of June 2020. This number is quite meagre for a country like India.

Setting up a charging infrastructure is a big challenge while marketing electric vehicles

Despite various initiatives introduced by the government to push the usage of EVs, the pace of building charging stations has been very slow. This is partly on account of the high cost of chargers as they are imported from China and Germany. This is one of the key reasons for the lower uptake of EVs in India.

3. Scaling experiential marketing

EV players want their target customers to get a taste of their cars or scooters by organising experiential events. Companies like Tata Nexon EV, Ola Electric, Ather Energy and Audi India have given their prospective customers a chance to get the touch and feel of EVs through test rides. Scaling these events is a challenge as they need to be organised more frequently across the country. This would help more people get acclimatized with EV’s features.

4. Ownership cost for electric cars is more than that for ICE cars

Buyers consider the total cost of ownership (TCO), which comprises the acquisition, running and maintenance costs, in order to assess the viability of a vehicle. According to a white paper published in 2020 by Kearney, when the daily running averages less than 40-45 km, TCO for EVs is higher than that for petrol cars. The cost in the case of EVs lowers only for distances beyond this threshold. The majority of people in India travel around 35 to 40 km a day back and forth workplace, which reaps minimal benefits of savings for EV owners. Thus, lowering the ownership cost would make EVs an attractive option for Indian consumers.

Battery and charging infrastructure remains the highest cost component in an electric vehicle.

Acquisition cost is mainly driven by a vehicle’s battery cost. EVs use a Lithium-ion battery which is the most expensive component of the vehicle. As per Kearney’s study, a reduction of 30-40% in battery cost will make acquisition costs of EVs and ICE cars similar. However, considering the current trends in battery technology, India needs another 3-5 years to make batteries available at the said price levels.

5. Training sales force with the technical know-how

The sales representatives present at showrooms/dealerships need to be fully aware of the technical aspects and benefits of EVs. They should know the nuances like how to calculate charge and time for a charging session. Dealers need to dispel apprehensions around charging and range among potential customers. This will enable more sales as customers will feel confident about their purchases.

6. Lack of service stations

This is one of the major pain points for EV owners as they are unable to find service stations easily when they face any technical glitch. EV makers need to strategize on how to cater to the aftersales requirements of customers. This could be done either through workshops by installing fully-equipped service stations in key areas.

Final Thoughts on EV Marketing Challenges

India has come a long way in fulfilling its vision of clean and sustainable mobility. It started with people adopting two and three-wheelers in the electric vehicle segment. This pushed all the major brands in the auto sector to manufacture EVs in a bid to innovate and build an emission-free environment.
But EV makers face certain challenges too.

This blog highlights 6 of those challenges to be addressed in 2022 so that marketing strategies for EVs can get a greater reach. When brands start comparing EVs with conventional automobiles in advertisements, the hesitation among consumers will gradually fade away.

So here is a question for our readers – In your opinion, which other challenge/s do EV makers face in the Indian market?