EV retrofits: A good fit for e-commerce and intra-city logistics

Soma Tah

Deepak MV, CEO & Co-founder of EV startup ETrio tells PCQuest what makes EVs a better choice for the E-Commerce and intra-city logistics and how electric light commercial vehicles (eLCV) retrofits can speed up the EV adoption in these sectors

What makes e-commerce and logistics a potential area for EV adoption  in India? What are the factors that could accelerate the adoption further? 

Commercial Vehicle sales have grown 20% and 17% in FY 18 and FY 19 respectively to reach 1 million mark. The small commercial vehicles (SCV) segment (vehicles under 1 Tonne) stand at 235,024 (287180 including LCV Dost) with more than 15% share of the overall commercial vehicles category. The SCV industry finds its primary application in the intra-city logistics space and has been growing at an incremental rate of 10%, 17% and 35% respectively  in the last three years.  

The Indian logistics stands at USD 160 billion with road transportation contributing to a lion’s share of 65%- is also another potential area for EV adoption. The logistics value chain comprises transportation, warehousing and administration.  

Some of the major factors which will accelerate the EV adoption in intra-city logistics especially in the e-commerce logistics space are:  

Decarbonizing Mandate: Most governments have set deadlines for complete transformation of mobility to zero-emission. In addition to this, major e-commerce and incumbent logistics players have unilaterally set targets for transformation of their commercial vehicle fleet to electric vehicle. 

Ease of Charging Infrastructure: A key component in enabling electrification of intra-city logistics is the ease of charging infrastructure. The e-commerce logistics space can adopt this if they are provided with charging facilities at hubs, overnight slow charging options, and government subsidies for enabling EV charging infrastructure. Adoption of renewable energy will also help in driving the electricity costs down.  

Route predictability and limited range: The routes for each of the delivery vehicles are well mapped and the average run of a vehicle on a single shift is in the range of 50-60 km a day.   

Operating Cost Optimization:  As per a study, the majority of online users abandon purchase on account of the shipping cost being too high. This has forced all the e-commerce players to reduce the operating costs as well as contain excessive fluctuations over certain term periods. Further, the last mile or intra-city logistics also contribute to almost 50% of e-commerce logistics cost and the optimization of the same is the focus of industry. EVs have a strong advantage as far as operating economics are considered. Further, the increase in operating costs over the life of the vehicle is significantly higher for ICE over EV.  

"The last mile or intra-city logistics contribute to almost 50% of e-commerce logistics cost and the optimization of the same is the focus of industry. EVs have a strong advantage as far as operating economics are considered" 

What are some of the challenges to the faster commercial EV adoption in India and how are you trying to address those issues? 

The biggest bottleneck inhibiting the industry at large from launching EVs is the significantly higher upfront cost of EVs. Other challenges include Range Anxiety, Reliability, and Charging Infrastructure.  

While all the above factors facilitate rapid EV adoption, the SCV segment hasn’t seen any EV being introduced by either the large OEMs or smaller organized players except e-Supro launched by Mahindra & Mahindra in 2018. However, the model was discontinued due to poor market response and product issues.  

We at ETrio, took these challenges and turned them into our strength by providing Connected Mobility solutions; a highly feasible Total Cost of Operations; Finance, Insurance, RSA, AMC and other Value-Added Services.  

A holistic system must work towards overcoming all the challenges of the EV ecosystem. This is driven through various initiatives at ETrio such as driver training, connected IoT for remote monitoring and predictive maintenance, ease of home socket charging, 24X7 service and most importantly a robust vehicle.   

The EV options are conspicuously less in the small commercial vehicles (SCV) segment. No models have been introduced after the launch of e-Supro by Mahindra & Mahindra in 2018

Cost remains the biggest barrier to EV adoption, what kind of policy intervention, govt. incentives, and innovation are needed to overcome this issue?  

The significantly higher upfront costs of EVs are overwhelming the operating cost advantage of EVs and stretching the breakeven period beyond the earning potential and patience of the Indian customer. We feel that homogenization of state EV policies is needed to avoid confusion and to help OEM maintain single standard pricing and processes. Also, Technological and Monetary Support to MSMEs for Rapid Indigenization of Supply Chain, Re-Inclusion of Direct subsidy for retrofitment, Policy on the life of vehicle allowing longer life for EVs and extension of life post retrofitment will also help drive faster adoption of EVs in the country.     

What kind of innovation are you trying to do in the EV battery space (improving range, reducing form factor and costs, etc.), especially keeping India's power situation and the lack of charging infra in mind?    

Range extension on a battery is more of an indication of the vehicle efficiency and that has been the primary focus of ETrio since its inception. We work on reducing powertrain losses. It's like making the engine more efficient, so that fuel consumption (battery in this case) is less. Certain quick bits like cutting off power supply during idling, optimizing drive cycles, etc. have been done to extract more range from the same battery size. Furthermore, a robust assembly design coupled with smart BMS optimizes losses inside the battery pack itself.  

You recently launched the country’s first retrofitted electric light commercial vehicle (eLCV). Do EV Retrofits help in lowering the barriers to EV adoption?

Retrofitting provides dual benefits by decarbonizing the environment on the one hand and decongesting roads on the other. Our scientific retrofitment process makes diesel guzzling LCV into a green productive vehicle. For example, retrofitment can give Tata Ace a 5+ years of life extension. 

ETrio’s eLCV pricing can even compete with a diesel counterpart on the Total Cost of ownership and by saving almost 60% of the operational expenses, it can help in reviving the driver owner’s earnings also.

We feel, with a potential to transform and electrify intra-city logistics with a production capacity of 5000 vehicles annually, our initiative will not only help reshape the e-commerce logistics space but also have a deeper impact on the EV ecosystem. 

Also Read: 

https://www.pcquest.com/india-eyeing-ev3030-tag-theres-many-slip/