Downward Trend In Fuel Prices Could Negatively Affect Cost Benefit Of Electric Vehicles

A large number of factors may impact the demand for the Electric Vehicles (EVs) for next two to three years in a significant way and would require continued support from the government to create consumer preference towards EVs. This was highlighted in FICCI's Electric Vehicle Committee on 30 April 2020. The impact of COVID-19 could make consumers more risk averse to new technologies and higher priced vehicles, such as EVs, noted FICCI EV Committee. Further, the downward trend in fuel prices would negatively affect the cost-benefit of EVs in the medium term. Adverse impact of supply chain disruptions is also more likely on EVs than the ICE vehicles mainly because the supply chain for EVs in India is beginning to get established, vis-a-vis a long established supply chain for ICE vehicles.

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