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Electric Mobility Takes Centre Stage In India’s Logistics Business: Analysis

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Electric vehicles (EV) are getting a major push in India. While there is still some time before we see any noticeable growth in the personal mobility space, when it comes to the last-mile cargo segment, EVs have already made a huge mark for themselves. According to data provided by the Society Of Manufacturers Of Electric Vehicles (SMEV) 2,36,802, electric vehicles were sold in FY2020-21, out of which 88,378 units were electric three-wheelers. Mind you this data doesn’t include those low-speed E3Ws that are not registered with the transport authority, which are passenger carriers majorly used in tier 2 and tier 3 markets. However, in the cargo space, brands like Mahindra Logistics, DHL, Amazon, and Flipkart, among others, have already made substantial investments to convert their cargo fleet to electric in the coming years.

Also Read: Mahindra Treo Zor Electric Three-Wheeler Surpasses 1,000 Unit Sales Milestone

A major chunk of electric three-wheeler sales is coming from e-commerce and logistics brands, which are using them for last-mile cargo transportation. For instance, Amazon India is working towards adding 10,000 electric vehicles to its fleet by 2025, and part of its global goal is to have 100,000 EVs in its fleet by the end of this decade. Talking about the company’s EV strategy, an Amazon India spokesperson said, “These vehicles will operate in over 20 cities of India including Delhi NCR, Bengaluru, Hyderabad, Ahmedabad, Pune, Nagpur and Coimbatore to name a few, and this number continues to grow.”

Amazon India deployed close to 100 Mahindra Treo Zor vehicles in seven Indian cities and aims to have 10,000 EVs in its fleet by 2025

In February 2021, Amazon India deployed close to 100 Mahindra Treo Zor vehicles in seven Indian cities across Bengaluru, New Delhi, Hyderabad, Ahmedabad, Bhopal, Indore and Lucknow with Amazon India’s network of Delivery Service Partners. Later, in April 2021, the company expanded its EV two-wheeler fleet by partnering with Hero Electric and start-ups such as EVage. “Amazon India’s Delivery Service Partner fleet of EVs now includes 2-wheeler, 3-wheeler and 4-wheeler vehicles, which are designed and made in India and will be deployed across the company’s delivery partner network,” added the spokesperson.

Also Read: Tata Motors Working On End-To-End Electric Vehicle Solution For Last Mile Cargo Segment

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Flipkart has over 450 EVs in its logistics fleet right now and aims to convert its entire fleet to 100 per cent electric by 2030

At the same time, rival Flipkart has also expressed similar goals. The company aims to convert its entire fleet to 100 per cent electric by 2030 and deploy over 25,000 EVs by the end of this decade. Commenting on the shift to EVs, Mahesh Pratap Singh, Head – Sustainability and Social Responsibility, Flipkart said, “Businesses such as e-commerce, which depend a lot on vehicular transportation, are best placed to be early adopters and market-shapers in the EV space. We see tremendous potential for electric freight mobility to build a green and robust supply chain for the future. Going fully electric in this manner is one step in transitioning mobility systems to adapt to climate-friendly technology and operations that will not only future-proof the business but also drastically reduce transport-related carbon emissions.”

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Mahesh Pratap Singh, Head – Sustainability and Social Responsibility, Flipkart sees tremendous potential for electric freight mobility to build a green and robust supply chain for the future

Flipkart currently has over 450 EVs in its logistics fleet and the adoption is growing every month. Singh further added, “We are taking a step-by-step approach in electrifying our fleet that includes partnering with some of the leading electric vehicle manufacturers (including Hero Electric, Mahindra Electric, and Piaggio, and many others) to procure electric vehicles which can be directly deployed for delivery.” To that effect, back in April 2021, Flipkart had also partnered with Mahindra Logistics to avail of the latter’s electric last-mile delivery service – EDEL. Commenting on the partnership back then, Rampraveen Swaminathan, CEO and MD, Mahindra Logistics said, “Our focus is on expanding our network based on our deep partnership with large enterprise customers. We are pleased about this engagement with Flipkart and look forward to partnering with them.”

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Mahesh Babu, CEO, Mahindra Electric Mobility says 40-45 per cent of vehicles sold in this category to be electric before 2025

Such a large-scale adoption of EVs is also allowing vehicle manufacturers to expand their portfolio, which is eventually helping the EV ecosystem grow further. Talking about the segment, Mahesh Babu, CEO, Mahindra Electric Mobility said, “The adoption of electric vehicles in the last mile delivery segment has witnessed tremendous growth in the last few months. The TCO parity and lower cost of ownership are among the top factors that bode well for this price-sensitive segment. Going forward, we expect electric vehicles in the L5 category to expand into the market share of traditional small commercial vehicles. This is largely because of its higher earning potential, ease of operation and the ability to offer the same volume, value proposition as compared with its ICE counterparts in this category. We expect about 40-45 per cent of vehicles sold in this category to be electric before 2025.”

Also Read: Mahindra Electric Launches Global Electrification Solution for Light Electric Vehicles

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Sulajja Firodia Motwani, Founder and CEO, Kinetic Green says, in India, adoption of EV is likely to grow with commercial vehicles rather than in passenger vehicle space

Also Read: Kinetic Green Safar Jumbo Electric Cargo Three-Wheeler Launched

Talking about the importance of EVs in the logistics space, Sulajja Firodia Motwani, Founder and CEO, Kinetic Green, said, “Clean mobility is now taking centre stage in India with an aggressive push towards rapid electrification of the country’s transport system. The major focus on electric vehicles comes from larger concerns of high pollution, fuel security, heavy oil import bill and rising costs of internal combustion engine (ICE) vehicles as well as fuel. In India, adoption of EV is likely to grow with commercial vehicles rather than in passenger vehicle space with commercial vehicles predicted to have a market share of 70 per cent by 2030 as per DataLabs.” She further added, “Kinetic Green is working closely with several e-commerce players in the market to create pilots and establish deployment models in many cities. We are also working closely with many logistics companies. We have deployed vehicles in several cities already, using fixed and swappable battery options.”

Also Read: Piaggio Launches Ape Electrik FX Range Of Electric 3-Wheeler For Cargo And Passenger Segment

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Diego Graffi, Chairman and MD, Piaggio India feels last-mile transportation, logistics & E-Commerce seem to be favouring a shift towards Electric Vehicles

Diego Graffi- MD & CEO of Piaggio Vehicles, which recently entered the electric cargo space with the all-electric Ape’ E-Xtra FX, expressed similar views about the segment. He said, “During the pandemic, we saw a recovery in our cargo segment wherein e-commerce also played a role. Last-mile transportation, logistics & E-Commerce seem to be favouring a shift towards Electric Vehicles. Today, the Ape’ E-Xtra FX is India’s most powerful and reliable last-mile 3 w cargo vehicle.” Piaggio has already started supplying its electric 3-wheeler to Flipkart and various logistic operators, and the company plan to shortly begin supplying to all major e-commerce players in India.

Also Read: Piaggio Plans to Setup 100 EV Experience Centres In India By The End Of 2021

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The ongoing second wave of coronavirus and the resultant curfews and lockdown has certainly not made things easy for any segment. However, as expressed by all these different players, with people staying home, e-commerce platforms are seeing increased demand, which is therefore helping the last-mile cargo vehicle segment grow. The fact that in the current conditions EVs have become a more cost-effective solution for these logistics companies is a win-win situation for both the businesses as well as the environment.

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