Why Indian Brands Need to Work Together on EVs

Honda and Nissan recently announced a tie -up to work together on EVs. The collaboration will include their core parts and software. Early discussions also involve the joint procurement and development of components and batteries. The carmakers said they are teaming up to better address competitive threats in the US and China. The Big Four Japanese two-wheeler manufacturers - Honda, Kawasaki, Suzuki, and Yamaha - have already joined hands. This will enable? battery swapping and help develop infrastructure for battery swapping. Japan's biggest oil refiner, Eneos Holdings is also part of the joint venture. Last year Honda, KTM, Yamaha, and Piaggio also agreed on a standardized swappable battery system for Europe.

The brands above have far deeper pockets than any of the Indian brands jostling for a podium position in the Indian EV space. However, any such joint declarations are rare in the Indian EV space.

Imagine a small beginning with a commitment towards cross utilisation of each other’s chargers by the EV 4-Wheeler brands in India. Overnight all the EV chargers fixed outside showrooms would become brand agnostic and available to a majority of the EV car owners to use. The same can happen with the 2-Wheeler players. The 2-wheeler players could also agree to common swappable battery designs and protocols. That would go a long way to obviate the commonly known hurdles to EV adoption.

What if Tata and Mahindra were to jointly create a new venture to allow EV users to lease their batteries instead of buying outright? Surely that would narrow, if not demolish outright, the price gaps between EVs and ICE vehicles? Tata, Maruti and GM once sold thousands of vehicles with the Fiat 1.3L Multijet Diesel. Even now, Tata, MG and Jeep share a 2.0L Diesel in their SUVs. Then why the trepidation in looking at a broader EV alliance? What stops greater synergy in EVs?

We make take solace in the fact that Mahindra is using VW Battery Technology for its upcoming EVs . But industry watchers know that 1) an unequal alliance rarely leads to a satisfactory outcome in the Indian auto space and 2) Mahindra has left behind a trail of short-lived alliances with global partners that makes for more interesting reading than The Seven Husbands of Evelyn Hugo.

The answer perhaps is that the leadership in many of these companies still sees EVs as a “side hustle”. Their Product and Strategy teams are not devoting sufficient bandwidth to thinking thru the emerging scenarios in the EV space. Or perhaps the leadership has illusions of grandeur of capturing pole positions flying solo. As they say, all illusions are left in the dust after the war starts in real earnest. There have been ominous rumblings of cheaper hybrids and top secret EVs from the Maruti Suzuki – Toyota behemoth. The Hyundai Creta EV has is testing prolifically. The JSW MG wedding in my opinion was the more important nuptials function in recent memory. Both Adani and Ambani appear to be working seriously on Green Mobility. BYD overnight doubled its monthly sales volume and Vinfast today is more than just a rumour.

Sustained leadership in EVs will require bottomless pockets, huge engineering and strategic bandwidth. It is high time the legacy Indian automakers, both 4 Wheeler and 2 Wheeler makers, batten down the hatches and start thinking in terms of working together on EVs if they want to stay relevant beyond the current decade.

What is your opinion on Indian brands collaborating on EVs? Do you think this would indeed be a game changer for the industry? What holds back Indian manufacturers from working together? Would love to hear your feedback.

Look out for my next article. I post them every Friday.

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