How are Governments Contributing to Boom of Asia-Pacific (APAC) Electric Three-Wheeler Market?
Asia-Pacific (APAC) Electric Three-Wheeler Market
One of the biggest factors responsible for the growing adoption of electric three-wheelers in the Asia-Pacific (APAC) region is the rising number of government policies and incentives in the form of tax rebates and subsidies, encouraging the adoption of electric vehicles in several countries in the region. For instance, according to the Faster Adoption and Manufacturing of (Hybrid &) and Electric Vehicles (FAME) in India, the government is offering subsidies in the range of $370–$900 on the purchase of electric vehicles in the country.
The other major factor fuelling the rise in the demand for electric three-wheelers in the APAC region is the low ownership costs of the electric vehicles. The operational expenses associated with an electric three-wheeler are almost 6 times lesser than that of the vehicles running on diesel/gasoline, on account of the lower costs of the stored electric charge than the gasoline. Moreover, the maintenance cost of an electric three-wheeler is also lesser than that of the diesel/gasoline powered vehicles and this further pushing their demand in the region.
Electric three-wheelers are either powered by sealed lead–acid (SLA) batteries or lithium-ion (Li-ion) batteries. Of these two types of batteries, the SLA batteries registered higher sales in 2017, as they are cheaper. However, the li-ion batteries, owing to their rapidly reducing prices, are expected to record faster growth in usage in the APAC electric three-wheeler market in the near future. Additionally, the Li-ion batteries offer numerous advantages over the SLA batteries such as lighter weight, higher energy density, much lower environmental damage, and greater life span and thus, these batteries are observing soaring demand across the world.
The motors integrated in electric three-wheelers operating in APAC come in three power ratings: less than 1,000 watts, between 1,000 and 1,500 watts, and greater than 1,500 watts. Amongst these, electric three-wheelers equipped with motors having power in the range of 1,000—1,500 watts registered the highest sales in 2017. This is primarily ascribed to the operational cost benefits of the electric three-wheelers equipped with these motors. However, due to the rising need for high-speed electric three-wheelers, the demand for higher power motors will rise rapidly in future.
The demand for electric vehicles is particularly high in Asia-Pacific (APAC), owing to the surging air pollution levels in India and China, rapidly expanding automotive sector, and favorable government policies in the region. Governments in the region are providing tax rebates and subsidies on the purchase of electric vehicles, which is highly suitable for developing countries where the disposable income of people is low. For example, according to the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles, the Indian government is offering subsidies on the basis of the model and the original equipment manufacturer, ranging from $370 (25,000 INR) to $900 (61,000 INR).
This can be ascribed to the rising need for low-cost shared mobility services and the presence of a large consumer base in the region. This being said, the demand for electric-three wheeler load carriers is also expected to increase significantly in the years to come due to the low operational cost of these vehicles as compared to their counterparts and expanding e-commerce industry. Electric-three wheelers have different motor powers, namely less than 1,000 W, between 1,000 and 1,500 W, and more than 1,500 W. Out of these, the demand for electric three-wheelers ranging from 1,000 W–1,500 W was higher in 2017.
Most of the electric-three wheelers are integrated with motor power in the above mentioned range, as they offer operational cost benefits. Apart from this, the demand for electric-three wheelers having increased motor power is also projected to rise in the years to come, owing to the surging need for high-speed electric vehicles and products with enhanced quality. The two types of batteries that are used in electric-three wheelers are lithium-ion (Li-ion) and sealed lead acid (SLA) batteries, between which, the demand for SLA batteries has been higher in the past.
Therefore, it can be said with full surety that due to the rising need for eco-friendly modes of transportation and the presence of numerous government incentives supporting the adoption of electric vehicles in several APAC countries, the demand for electric three-wheelers will boom in the APAC region in the coming years.
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