Global automotive group, Stellantis has decided to launch Citroen electric vehicles (EV) in India’s nascent market to gain a share in the climate-friendly vehicles space.
The company may also explore opportunities to export affordable, India-made EVs to European markets, but no decision has been taken as yet, said Chief Executive Officer Carlos Tavares, who was in India to review operations of Citroen’s Hosur and Tiruvallur factories in Tamil Nadu.
Carmakers in India will have to comply with stricter emission norms, requiring a gradual shift from traditional combustion engines to more fuel-efficient products such as electric vehicles to lower their carbon emissions footprint.
Amsterdam-based Stellantis, which has a portfolio of 14 automotive brands, including Jeep, Peugeot, and Maserati, sells cars under the Jeep and Citroen brands in India.
Citroen, which entered the Indian market with its first product in 2021, is preparing to launch an electric variant of its premium hatchback C3 at the beginning of next year. The brand’s two products, the C5 Aircross and C3, have a market share of 0.5% in India.
“Most of the time, what I observe is that the consumer does not decide on EVs. It is made by regulations. Regulation is going to impact your freedom of mobility and your lifestyle. Why should we enter the EV market now? Because regulations are going to bring the market in my direction. If my market share in India is 0.5% and I can get 10% in EVs when the market mix moves from internal combustion (IC) engines to EVs, I will surf on the wave,” he said.
EVs at a present cost nearly 40% more than traditional cars on average, Tavares said. The supply chain will have to bear nearly 85% of the total production cost, to achieve price parity between IC engines and EV vehicles in 4-5 years.
“Volatility in raw material costs and availability is going to be a big issue for electrification. Lithium, nickel, and manganese are going to be scarce because of a significant ramp-up of electrification that in some places is happenings as a consequence of regulations,” Tavares said.
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