Demand for EV rises as FMCG, E-commerce companies look to save costs

The demand for Electric Vehicles by FMCG and ecommerce companies have doubled from last year. This as the companies are looking to cut costs by over half and meet carbon emission reduction targets. As per Economic Times, Amazon, Hindustan Unilever, Swiggy, Coca-Cola, Zomato, Amul, Flipkart, BigBasket and Bisleri are among the larger companies switching to EVs to service consumers and retailers.

"We have started EVs for last-mile deliveries for ice-cream vending," Jayen Mehta, managing director of India's largest dairy maker Amul told Economic Times. He further added that milk distributors in Delhi, Uttar Pradesh, Haryana and Punjab are also using EVs for delivery.

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The ecommerce sector is also heavily leaning on electric two-wheelers. Amitabh Saran, cofounder of electric three-wheeler company Altigreen has told Economic Times that the operation costs are about a fraction of diesel or CNG-driven ones which helps in saving costs. Altigreen has supplied EVs to Amazon, Flipkart, BigBasket, HUL, Bisleri and Coca-Cola.

"The operating costs are about a fraction of diesel or CNG-driven ones, translating into substantial savings for operators," Saran told Economic Times.

He further added that the potential for e-vehicles in India is huge and that the country has not yet explored the possibilities.

"Even if we were to carve out use cases which require heavier payloads and exports, the market size is still about 1.2-1.3 million units per annum. India has not yet explored formats for three-wheelers fully. The potential is huge,"Amitabh Saran told Economic Times.

The companies are also signing partnership deals with EV manufacturers to set up charging units to enable seamless operations. Amazon India is partnering with Eicher Motors and Buses for 1,000 electric trucks, for middle-mile and last-mile delivery over the next five years while TVS Motor Co has inked a strategic partnership with food delivery and search platform Zomato for 10,000 electric scooters over the next two years.

As per Economic Times, over 1,00,000 electric cars and about a million electric two-wheelers (E2Ws) are expected to be sold this fiscal year, from about 50,000 electric cars and about 727,000 E2Ws in FY23.