The mobility sector in the emerging markets of South and Southeast Asia could absorb up to $1.3 trillion in green capital by 2030, and India holds the future, a new report by LeapFrog Investments, Temasek, Mahindra Last Mile Mobility Limited, and Battery Smart said on Friday.
Souleymane Ba, partner and co-head of climate investment strategy, LeapFrog Investments, stated that they have identified a $1.3 trillion opportunity for private markets and the impact investment community to reshape the future of global transportation.
The report reveals that the cost of owning an electric vehicle is lower than that of internal combustion engine counterparts in India. In India, the report said, electric scooters and three-wheelers are currently around $40–$112 cheaper per year to own than petrol alternatives.
“Low-cost electric scooters and three-wheelers are now cheaper to own than internal combustion engine equivalents in India,” the report said.
The opportunity is being driven by a surge in demand, largely fuelled by first-time buyers. Mahindra estimates that around 70 per cent of electric vehicle (EV) three-wheeler customers are first-time buyers from low-income backgrounds.
Case studies from Mahindra Last Mile Mobility Limited and Battery Smart also found that manufacturing and infrastructure for EVs are increasing across the region.
However, the report highlights the urgent need for investment in EV infrastructure, including battery swapping and charging networks, to drive this transformation forward.
Mobility emissions represent 10 per cent of total greenhouse gas (GHG) emissions across Asia, but 25 per cent of Europe’s emissions and 30 per cent of the US’s, making rapid electrification critical as incomes in emerging Asia rise, it said.
An increasingly efficient network of battery swapping stations, supported by interoperable battery systems across vehicle manufacturers, has dramatically improved re-fuelling infrastructure for EVs.
At the same time, innovators and investors are addressing key constraints to adoption, such as upfront costs, range anxiety, and infrastructure issues.
Steve Howard, vice chairman, sustainability, Temasek, said that the technology improvements and business innovation in emerging Asia’s EV sector, “when coupled with enabling policies and substantial investments, hold tremendous promise for transformative impact at pace and at scale”.
Indigenous companies are leading the change.
Suman Mishra, managing director and chief executive officer of Mahindra Last Mile Mobility Limited, stated that they will continue to lead the push for electrification. “As we advance electrification, we are equally focused on enhancing the lives of our customers, many of whom are micro-entrepreneurs, while supporting India’s path to lower carbon emissions by offering sustainable and cost-effective solutions,” she said.
Pulkit Khurana, co-founder and chief executive officer of Battery Smart, stated, “The fact that 20 per cent of all last-mile delivery fleets in India are now electric is a strong indicator of wider adoption.”
According to the report, an increasingly efficient network of battery swapping stations, supported by interoperable battery systems across vehicle manufacturers, has dramatically improved re-fuelling infrastructure for EVs.
First Published: Sep 20 2024 | 8:26 PM IS