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M&M’s e2o can save you Rs 4 lakh in five years

Published on 24 Mar. 2013 10:51 PM IST
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In 2012, Nissan’s flagship electric vehicle (EV) Leaf failed to meet even half its targeted sales of 20,000 units in the US. This compelled CEO Carlos Ghosn to cut the price of Leaf by $6,400 to $28,800.

Tesla Motors, run by a Calfornia billionaire and entrepreneur Elon Musk, failed to meet its production target in 2012; that resulted in the EV maker failing to meet a commitment on a term loan of $465 million.

General Motors (GM) sold 23,461 Chevy Volts in 2012, three times the previous year’s number. However, these sales were still well below the target of 35,000 to 40,000; even this target was revised downwards from 60,000 units initially targeted by its CEO Dan Akerson.

The point of these numbers: consumers in developed countries haven’t been taken in by the hype created around EVs. That explains why global EV sales in 2012 were just 0.12% of the total 74 million vehicles sold.

So why then is the top brass of Mahindra & Mahindra (M&M), which launched the e2o early this week, so upbeat? Answer: its affordable price of Rs 6 lakh, or what a high-end automatic petrol-engine hatchback would cost in India.

Contrast that price tag against those for EVs in the West. The Leaf, for instance, is priced virtually at par with a Jaguar XF (if you exclude government subsidies on these vehicles in some countries) and only seriously ‘environmentally conscious’ buyers with that kind of budget will plump for an EV. The Chevy Volt is even more expensive, at almost $40,000.

“Consumers are not willing to pay a high premium for such vehicles. Affordable EVs are the key to volume growth,” said Chetan Maini, chief technology & strategy officer, Mahindra Reva and founder of EV maker Reva.

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