Maruti Suzuki Alto cars to be exported are parked in a holding area at Adani Ports and Special Economic Zone in Mundra, 400km from Ahmedabad. Photo: AFP / Sam Panthaky

India’s largest carmaker Maruti Suzuki has so far steered clear from the country’s fledgling electric vehicle (EV) market but is now accelerating in that direction with plans to launch EV models by 2025. The company is reportedly now carrying out extensive tests on some of its existing models and factory lines for possible EV production.

Maruti Suzuki’s new managing director and CEO Hisashi Takeuchi told Press Trust of India, “We are a little behind our competitors in introducing the electric vehicle model to the Indian market, but we see that still, the market demand is limited. Actually, sales of electric vehicles in the Indian market are still very, very limited.”

He, however, elaborated, “But that does not mean we are doing nothing about electric vehicles. We have done a very extensive test of our electric vehicles utilizing our existing models and putting those batteries and motors and everything into this existing model.

We have been doing this test for more than a year with multiple cars in the Indian environment so that we are sure that our electric vehicle technology will be good in the environment, which is very, very tough in India.”

He said that electric vehicles in India were still very expensive and with the current technology it is quite difficult to make affordable clean cars. But Takeuchi is confident that once the company enters the electric vehicle market, Maruti Suzuki will secure a leadership position.

When asked whether the company can introduce an electric car for under one million rupees (US$13,100), he said, “I can’t give you a specific answer right now but what I can tell is that it’s really difficult to have a cost-competitive and less expensive electric car because of the cost of a battery.”

Takeuchi’s predecessor, R C Bhargava, had also taken a cautionary stance on EV production. He had said that Maruti Suzuki will enter the EV space only when it is feasible for customers in terms of affordability as well as for the company to operate without making a loss.

Maruti Suzuki had tested an electric vehicle based on its WagonR model in 2019, with plans to launch in 2020. But it later dropped the move citing a lack of infrastructure and government support. The company has maintained that at current prices it would be difficult to sell affordable EVs on a mass scale in the Indian market.

Last month, parent company Suzuki Motor Corporation announced that it would invest around 150 billion yen ($1.18 billion) by 2026 for local manufacturing of Battery Electric Vehicles (BEV) and BEV batteries in Gujarat state.

The company’s representative director and president Toshihiro Suzuki had said that Suzuki’s future mission is to achieve small car “carbon neutrality.”

India’s EV space is currently dominated by two-wheelers as they are less expensive and used for short-haul drives. Electric cars sales were a mere 17,802 units last fiscal year, according to the Federation of Automobile Dealers Associations.

Tata Motors led the electric passenger vehicle segment in 2021-22 with retail sales of 15,198 units and a market share of 85.37%.

The slow uptake of electric passenger cars has been attributed to their comparatively higher price tags compared to gasoline or diesel cars. Another deterrent is insufficient charging infrastructure, especially on highways.