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EV plan will not work overnight - Rajiv Bajaj

13/08/2019 | Author: Autoguide | 0 Comments Back To Home   < Previous News   |   Next news >

Mr. Rajiv Bajaj, MD, Bajaj Auto

Bajaj Auto Managing Director Mr Rajiv Bajaj is in the middle of a row with incumbent automakers on one side and startups and the NITI Aayog on the other over whether or not to ban two- and three-wheelers that run on fossil fuels. As much as 99 per cent of the electric vehicle sellers in India are traders; they are bringing the vehicles from China and creating jobs there, he told Satish John of the Economic Times in a recent interview. India, he said, tries to do everything overnight and that is why many initiatives don’t work. He urged the Government to test EVs in a few cities before adopting a national policy. Herewith we reproduce the edited excerpts of the ET interview:  
 
Question: Are the Budget proposals enough for established players to take a plunge into EVs and discontinue the production of conventional vehicles?
 
Answer: It is not the manufacturers that decide. There was a very famous saying by Mr Soichiro Honda (founder of Honda Motor), that it is not the manufacturer who shapes the market, it is the customer. Whatever incentives are there, they are available to all, it doesn't matter whether they are existing OEMs (original equipment manufacturers) or new startups. And nobody from the OEM side or SIAM (Society of Indian Automobile Manufacturers) side has said that we are on one side and the startups on the other side — we are all on the same side. The Government has not said the benefits are only for startups and not for OEMs. Whatever benefit is there, it is available for everyone. 
 
The thing is, whether you are an OEM or a startup, you can only make the vehicle to best of your abilities. Ultimately, the customer has to buy it. And that is where the problem starts. Today, electric vehicles constitute less than 1 per cent of the size of the industry and for the life of me, I cannot understand how somebody can imagine that 1 per cent can become 100 per cent in six years' time. 
 
Question: You are not per se objecting to EVs? 
 
Answer: Nobody in SIAM has objected to electric vehicles or to incentives for electric vehicles. Electric two-wheelers and rickshaws have been plying in India for years and their numbers have been growing. I, as an auto-rickshaw maker, never said that do not allow e-rickshaws. Let one minister, Secretary, or an editor of a newspaper or news channel stand up and say that. We are all for electric vehicles and we are all for supporting and incentivising electric vehicles. At the same time, we are also saying that we are the same industry which is making world-class two-wheelers and three-wheelers. The proof of that is that we are exporting three million vehicles every year. These are earning a great name for our country across. These are earning $3 billion of forex.
 
Assuming that electric vehicles are better — and I'm once again saying that I don't think they are better; they are good and so are IC engines — even then, why do you ban the other technology? When IndiGo or Jet Airways start, does it mean that you ban Indian Airlines? Just because 4G comes, do you ban 2G? Let the customer decide. This is one principle because of which I don't agree with banning IC engine vehicles. 
 
There is also a practical reason. EV acceptance today is only 1 per cent. And people are bringing them from China — 99 per cent of EV sellers are traders, they are not engineers. They are just traders who are giving jobs to China by bringing the vehicles from there and dumping them in this market. But after doing all this, if your acceptance is only 1 per cent, then I want to ask the Government that do you really want to take this one swallow and make a summer out of it? Because tomorrow, if you force us all to go that way and the customer doesn't accept it, what will happen to the industry? That means the IC engine is stopped, all those people are out of jobs, and electric vehicles are not selling. What are we supposed to do then? Shut shop and sit at home?
 
Policy wonks are pointing towards China and its successful migration towards EVs. The Chinese example is being completely misunderstood. In China, they started banning IC-engine two-wheelers only in select cities like Shanghai, Beijing, etc. So, China was doing something very selective and targeted whereas our people are doing something very general. Also, when they introduced the electric vehicle in China, they proposed a policy called 20-40. This means that the vehicle should not go at more than 20 km/h and the weight should be less than 40 kilograms. 
 
The two big advantages of this rule are that the technology doesn't become a challenge and the acquisition cost remains low. 
 
In India, no such a rule has been proposed. China had willingness towards a minimalistic approach whereas we seem to have a maximisation approach. The third thing that China did was they built huge infrastructure in terms of road connectivity and made special lanes which were reserved for pedestrians, cyclists and such vehicles which complied with the 20-40 rule. This was to address the safety and congestion.  You cannot take just one piece of the China puzzle.
 
We are committed to electric vehicles but because of this 'trial balloon' which has been floated by NITI Aayog, am I going to panic and change the direction of my ship to a new destination? No. Because I am not convinced that it will work. 
 
Startups say it is very difficult for big companies to change overnight and hence they are criticising. We don't have to prove our credibility to people who have done nothing so far.
 
The reason so many of the initiative of the Government did not work is that they tried to do everything overnight. Same thing they are trying to do here. I would say you take four cities of India which are very polluted like Shanghai or Beijing, and debate what should be done to get 100 per cent electric vehicles there. Instead, you try to make an all-India policy
 
Question: Once the Government or NITI Aayog decides something, it is very difficult to make them change their mind. Are you hopeful?
 
Answer: I totally disagree because I have seen many U-turns on this issue. Let us not forget, two years back in September 2017, Mr (Nitin) Gadkari himself had made some very ambitious statements which were withdrawn after a few months. In fact, if you ask the general opinion of the business community or even the general public, they will say that the Government is full of U-turns and flip flops. And this is true of not just this Government, this is true of all governments.
 

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