According to the comprehensive analysis, the vast majority (97%) of polled global automotive executives are confident in fulfilling government-mandated phase-out dates for internal combustion engine (ICE) cars. Despite this, they don’t always have a clear path to take: just 40% of respondents believe their organisation is now prepared to move from ICE vehicles to EVs.
As shown in the survey, automakers are focused on addressing these hurdles, with nearly two-thirds (66%) of global automotive executives admitting that the transition to EVs is a high priority for their company. This is also reflected in changes in worldwide R&D spending. According to the survey, in 2015, an average of 11% of R&D costs were focused on EVs, but this has nearly doubled to 21% now, and automotive executives predict it will reach 31% by 2025, a nearly three-fold rise in ten years. If hybrid vehicles are included, the Castrol poll projects that by 2025, EVs and hybrids would account for more than 70% of global R&D spend.
Closer to home, customer attitudes are changing in India, with 44% of all polled consumers considering an EV for their next vehicle purchase. 55% are still contemplating purchasing an ICE vehicle, whether diesel or gasoline powered. Among those who have already made the switch, 100% would consider an EV for their future vehicle purchase, according to the report.
Sharing his thoughts about the EV market in India, Sandeep Sangwan, Managing Director, Castrol India Limited said:
“We are excited about electric mobility and what the future holds for the automotive sector. In India, there is a lot of buzz around electric vehicles, but EV car sales currently account for less than 1% of total new car sales. Considering that penetration of cars is still low in India and is poised to grow further, we foresee continued demand for ICE vehicles till 2040, alongside EV market growth.”
Speaking about Castrol India’s offerings in the EV space, Sandeep Sangwan added,
“In India, the transition to EV’s might take place sooner in the two-wheeler and three-wheeler space, compared to four-wheelers. Castrol India is keen to support the transition to EVs and we are working with our industry partners to bring forth the next generation of technologies. Products such as Castrol ON EV fluids will have an important role to play and we are exploring technology collaborations with two-wheeler and three-wheeler OEMs. Besides product offerings, we are also ramping up creation of a Service & Maintenance eco-system that can serve EVs and are expanding into adjacent categories such as car care products that are relevant for EVs as well.”
These figures omit automotive executives working for EV-only automakers. The Society of Indian Automobile Manufacturers is the source of this information (SIAM). Castrol India presently supplies EV fluids to Tata Motors and MG Motor for its electric vehicles in India, and it just received approval from BYD India to use Castrol fluids in BYD’s first all-electric MPV in India.
Factors Accelerating the Transition to EVs and Insights from Indian Consumers
The majority of survey respondents believe that governments must play an important role in the transition to EVs. According to 63% of global automotive executives polled, government-mandated ICE phase-out targets are the most important factor pushing the industry’s shift. Net zero targets are also a key issue, with 57% of automotive executives citing them as a major motivator. In terms of customers, the survey discovers that helping to reduce air pollution in urban areas is the most essential element in convincing current ICE and hybrid drivers to switch (92% of consumers in India regarded this as important). This is followed by the fact that EVs release fewer carbon emissions than petrol or diesel-powered vehicles (91%) and have lower running costs (89%). Furthermore, 74% of all Indian buyers believe that the overall cost of an EV – including tax, gasoline, and maintenance expenditures as well as the initial purchase price – is less than that of an identical petrol or diesel vehicle.
Roadblocks On the Road to Widespread EV Adoption
Based on the findings, the most significant impediment to the industry’s shift to electric vehicles is the high cost of batteries, which is cited as a problem by 56% of global automotive executives. The availability of charging infrastructure (43%) and a shortage of technical talent (40%), were identified to be the next most significant impediments. BP announced intentions to invest up to £50 mln (₹ 500 Crs) in Castrol’s Global Technology Centre in the United Kingdom in August 2022 to help promote the development of premier fluid technology and engineering for hybrid and completely battery electric cars. This will help the industry get closer to the critical tipping points for widespread EV adoption.
Consumers in India are most concerned about charging infrastructure. In India, 73% of non-EV drivers believe that ultra-fast charging is not widely available. Furthermore, despite the fact that the majority agrees that the overall cost of EV ownership is cheaper than that of a gasoline or diesel automobile, many consumers (67%) remain unsure due to a perceived greater upfront cost. A shortage of available EV models on the market was also identified as a hindrance (72% of buyers).
Switching On the Revolution
To hasten the transition to electric vehicles, the industry must collaborate to remove these impediments. Governments, infrastructure providers, car manufacturers, and suppliers will need to work closely and effectively together to improve the reliability and availability of charging infrastructure, improve vehicle battery life and mileage range, and cut upfront costs. Castrol is committed to collaborating with industry partners to speed the transition and assist in turning on an electric future. Castrol ON EV Fluids aim to help the industry overcome obstacles by allowing EVs to travel further1, charge faster, and last longer.