In April 2019, the Indian government approved phase II of the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India (FAME India) scheme with a budgetary allocation of INR 10,000 crore. This has given a massive boost to the sale of EVs in the country, especially of e-rickshaws, which were already high here. In 2019 alone, 4.5 lakh (450,000) e-rickshaws were sold in the country, bringing the total number of those in operation to more than 10lakh (1 million)!
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Apart from the government support for EV manufacturing and buying, the constant requirement of people for low-cost transportation is also driving the Indian e-rickshaw and on-demand ride hailing market growth. A large number of Indians still cannot afford personal vehicles, which is why public transportation is an important part of the everyday life in the nation. Rides on petrol, diesel, and even compressed natural gas (CNG) three-wheelers (autorickshaws) are often costly considering the distance traveled, because of the higher cost of refueling these vehicles.
In contrast, electricity is a lot cheaper, so e-rickshaw owners and drivers are able to offer rides at much lower costs, for just INR 10 for 1 km, which is about the average distance of each ride. Most people in the country use e-rickshaw services for first- and last-mile commuting, such as for traveling between bus stops or metro stations and offices or homes. Additionally, the usage of these vehicles is also rising for picking up children from school, which, in most cases, are located close to people’s homes.
The e-rickshaw and on-demand ride hailing market in India report provides an analysis of service users and vehicle drivers in a large number of tier 1, 2, and 3 cities. Among all the cities in the country, Delhi has been the largest e-rickshaw market in India. It is one of the most populated urban areas in the country; therefore, the demand for public transportation is rather high. Additionally, many people in the city are migrants from other tier 2 and 3 cities and rural and semi-rural areas, which leads to a high demand for cost-effective transportation, especially for shorter distances.
Hence, as the population increases and environmental concerns related to the operation of fossil-fuel-based vehicles surge, the sale of e-rickshaws for short-distance on-demand ride hailing services will burgeon in India.