Tuesday, April 16, 2019

FAME II Scheme's Reduced Incentives A Pain Point for Electric Two-Wheelers

The subsidies announced by the government under the FAME-II scheme was seen as a leg-up for the nascent Indian electric vehicle industry – in fact, the government’s proposed move to invest Rs 10,000 crore over a three-year period aimed at supporting ten lakh two-wheelers, five lakh three-wheelers, fifty five thousand four-wheelers and seven thousand e-buses, is being seen as just what the doctor ordered for the electric vehicles in the country,

But just a month after the government’s big-bang announcement, the FAME II scheme has left a pall of disappointment among the electric two-wheeler segment simply because the scheme has outlined a stringent eligibility criteria that will make it exceedingly tough for EV players to avail the scheme.

The FAME II scheme specifies that e-scooters in order to avail the scheme need to have a range of 80 km – a specification that could turn out to be a dampener for electric two-wheelers – electric two-wheelers currently have a range of around 60 km. It is generally felt that around 95 % of electric two-wheelers may not benefit from the scheme.

Range is not the only ‘concern’ point. The FAME II scheme also stipulates that companies that wish to avail the scheme must produce vehicles that have at least 50 % localisation. This could be a huge roadblock for adoption of EVs in India because given the current low volume of EVs the Indian component suppliers are not ready yet to manufacture EV components.

If the stringent eligibility criteria for 80 km range and 50 % localisation are not, the country's EV players are also unhappy with the government reducing the incentives from Rs 22,000 per kWh (as announced in FAME Scheme I in 2015) to Rs 10,000 per kWh in the FAME Scheme II for all vehicles save for buses. 

The apex body for EVs in India – the Society of Manufacturers of Electric Vehicles (SMEVs) has said such a move has seen prices of city-speed electric two-wheelers increasing by around Rs 10,000-12,000. Further, the SMEV has already sounded out the NITI Aayog and Department of Heavy Industry (DHI) over its strong reservations about the reduced incentives under the FAME Scheme II. It remains to be seen whether the government acts promptly and ensures the scheme really benefits the electric vehicle industry and not defeat the very purpose of doling out subsidies for rapid adoption of EVs in the country.

Important To Build On FAME II Subsidies By Indigenising EV Components

Cleaner mobility is an absolute need, and there’s widespread acceptance that of all alternate fuel technologies available in the market, electric mobility is the most pragmatic solution. However, it won’t be a far-fetched exaggeration to suggest that policy makers in the country have been quite indecisive with its EV policy – in fact, a slew of policy flip-flops has been nothing but a dampener on India’s EV push.

All these uncertainty appears to be a thing of the past with the government allocating Rs 10,000 cr under the Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles (FAME) II scheme, which will be implemented over a period of three years with effect from April 1, 2019. It may be worth noting that the latest move is an expanded version of the FAME scheme that was launched on April 1, 2015 with a total outlay of Rs 895 cr. The FAME II scheme plans to support 10 lakh electric two-wheelers, five lakh three-wheelers (meant for public transportation), 55,000 four-wheelers (meant for public transportation) and 7,000 buses.

INDUSTRY BUZZ

Understandably, there is a buzz of excitement and hope across the automotive industry over FAME II. There is no denying the fact that the scheme will not only fast-track the electric vehicle ecosystem, but also provide a certain degree of clarity and direction for EVs to thrive across the country.

Mahindra Electric, one of the pioneers of electromobility in India, said the FAME II scheme is just what the doctor ordered for the Indian EV ecosystem. “The scheme assures a long-term stable policy and outlines a clear vision for OEMs, component suppliers, fleet operators and dealers to have a clear direction for the next three years and help India to be one of the global EV leaders,” said Mahesh Babu, CEO, Mahindra Electric. He added that the scheme aligns well with the National Electric Mobility Mission Plan 2020 (NEMMP) and addresses key issues such as national energy security, mitigation of adverse impact of vehicles on the environment and growth of domestic technology and manufacturing capabilities.

The FAME II scheme accords high priority to electrifying the public transportation space and talks little about electrifying the personal mobility space. Babu felt that the move will work well for the Indian market, as fleet becomes the first priority given the impact on oil import, pollution and asset utilisation. The focus on public transportation is the need of the hour, he said and added that electric three-wheelers, shared fleet of electric cars and electric buses will in a way create an ecosystem for personal buyers to consider EVs.

The FAME II scheme talks about offering incentives only to those vehicles that are powered by lithium-ion batteries, which effectively means that lead acid batteries will go off the EV radar in due course. Babu said globally lead has been phased-out given its negative impact on the environment and Mahindra Electric is aligned with the government’s view of leveraging advanced battery technologies as defined by FAME.

ADVANCED BATTERY TECHNOLOGIES

Akshaye Barbuddhe, Business Head, EV Charging Solutions, Delta Electronics India said lithium-ion batteries are also more efficient as it provides a constant voltage through the whole discharge cycle, whereas lead acid batteries experience a constant drop of voltage. Maintaining constant voltage also translates into better efficiency. Of course, lead acid batteries are the cheapest to produce but as Barbuddhe pointed out, the real cost of owning a lithium-ion battery is far lower when factoring in performance and battery longevity. They are safer to use and offer a superior option in terms of environmental impact too.

One cannot overlook the fact that charging infrastructure is perhaps the biggest roadblock for EVs to thrive in India. And the FAME II scheme appears to address this as it has proposed establishment of 2,700 charging stations across metro as well as across other smart cities, Tier 2 cities and hilly regions and at least one charging station in a grid of 3x3 km.

Barbuddhe underpinned the role of DISCOMs in the EV push. “The government should push power DISCOMs to provide much-needed assistance, in terms of facilitating knowledge sharing and installation procedure to its consumer base,” he said. He urged the government to map out a long-term strategy to develop software solutions that will cater to the future needs of connecting all public charging stations with a common platform. Doing that would provide easy access to charging stations for end-users as well as ensuring 24/7 monitoring of charging stations by respective agencies as well as Central Electricity Authority (CEA). Effective grid management is critical towards ensuring EV charging infrastructure. Without adequate grid management, the system created to cater to EV infrastructure would eventually collapse, he said.

LOCALISATION OF EV COMPONENTS

Although appreciative of the FAME II scheme announcement, the industry has been equally critical of the scheme’s position on localisation of EV components to avail of incentives upfront. Ashim Sharma, Partner, & Group Head, Nomura Research Institute (NRI) Consulting & Solutions India, said India must attach importance to cell level manufacturing for EVs.

“If we import battery cells from abroad and assemble it together in India and make a battery pack, then there is limited value-add happening in India. A cell importing approach will reduce the manufacturing base in India in EVs when compared to ICEs,” he pointed out. Delving deep into battery management system (BMS), Sharma said the hardware of the BMS will continue to be imported as India does not have a vibrant semi-conductor, sensor manufacturing base, while the software testing for the BMS is readily available.

Electric motors are another area India can explore indigenising for EVs be it induction motors and permanent magnet motors. “Performance wise, there has been a slight shift towards permanent magnet motors but these are made of rare earth materials and large extraction of such materials happens in China. India needs to bring about technological innovations to reduce the amount of such rare earth materials used or look at other alternatives. Induction motors have overheating deficiencies and again innovation is needed to reduce this overheating.”

Kaushik Madhavan, Vice President – Mobility, South Asia, Frost & Sullivan felt that electric motors can be the first step towards indigenising components and sub-systems in the EV mobility ecosystem. “The electric motor technology in India is far more advanced as some Indian players are developing this technology. We could then look at battery manufacturing, including cells, and battery packaging.”

Madhavan called for intense discussion on how the industry can approach recycling of used batteries. There is a need to study and understand what we can do with used batteries, recycle them and make them viable for second life applications, he said. “As for now, there is no clear mandate or roadmap for battery recycling and this area can be the next stage of discussion so that a framework is in place for second life applications,” he suggested.

Given India’s limited EV manufacturing base and the evolving battery technology, it is imperative to incentivise the manufacturing ecosystem in order to optimise manufacturing costs that would ultimately cascade towards reduced EV prices, said P Pranavant, Partner, Deloitte India.

The FAME II scheme is clearly just what the doctor ordered for the Indian EV space. But it is equally critical that adequate steps are undertaken for indigenising EV components in areas of BMS, motors, controllers, etc. The EV push can only be a viable customer proposition in India when end-users feel that there is a ‘fundamental need’ to buy it.

Tuesday, April 2, 2019

‘Fundamental Need Has To Be Created for Adoption of Autonomous Vehicles’

Autonomous vehicles or self-driving cars have been generating plenty of buzz across the automotive industry globally. Autonomous cars are increasingly seen as something that will transform the way people ‘drive’. However, in the Indian context, the jury is still not out on whether such self-driving cars would be adopted in a big way, as there are strong reservations in various quarters over whether autonomous vehicles would end up eliminating jobs of cab drivers in a large way and whether the country will be ready with required infrastructure in years to come.

Mumbai-based Unlimit IoT has been working on ensuring next generation vehicles such as autonomous vehicles run in the manner it is supposed to run. Pradeep Sreedharan VP – Sales & Operations, Unlimit IoT, said the global automotive industry is a rapidly evolving space and is exploring different possibilities of how mobility can not only be less time-consuming, but also score high on safety and comfort parametres. In fact, autonomous vehicles are talked about as the most anticipated thing to happen across the industry alongside hyper loops, supersonic flying trains, flying cars and land airbus, he noted.

The Unlimit IoT top official said autonomous cars will not only transform the way end-users operate, but will also change the way end-users think since it is all about sensing the environment with very less human input. Of course, mobility has undergone a significant shift over many decades. 150 years back ago people were driven by animals, subsequently by animals and then by humanoids, in terms of robots or any artificial intelligence.

Sreedharan said the industry is even looking at a scenario where no one may want to drive the vehicle in coming years given the stress involved around it be it traffic snarls, rowdy driving, etc. Level 4 autonomous cars are absolutely available, but also added that Level 5 autonomous cars will be slightly difficult to grow as no one can say for sure how fast is the industry moving toward Level 5, he pointed out.

It is pertinent to mention that the automotive industry will witness a huge data explosion even as driverless cars are being adopted across the globe. Sreedharan said data will emerge as the new ‘oil’.

Sreedharan said every autonomous car roughly takes around data conception in the present standards equivalent to 3,000 people. Every such car will churn out 4,000 GB of data every day and one can well image the data generation in such cars, he added. There is huge data generation for autonomous cars because such vehicles are equipped with hundreds of on-vehicle sensors. It is said that cameras alone will generate 20 to 40 Mbps, while the radar will generate between 10 and 100 Kbps. There is no denying the fact that going forward automotive firms will become big computer organisations, Sreedharan stated.

Sreedharan also underpinned safety as the biggest USP of autonomous cars. He cited a US survey which revealed that people using autonomous cars in the US believe that the amount of insurance they pay out significantly reduces for autonomous cars and they quantified that in 191 million dollars. The survey stated that 91% of accidents is related to human error, which only underlines the essence of safety in such cars.

More importantly, Sreedharan said autonomous cars will ensure a peace of mind for vehicle user besides offering fuel efficiency and increased productivity. For an Indian scenario, any office-goer will reach office with less stress because he does not have to drive manually and also because traffic management in India is much better because vehicles move in directions and not in lanes, he noted.

He said driverless cars are a concern area for a country like India, where driving as a profession provides livelihood to thousands of people, especially cab drivers. Even insurance companies will have to change their business model completely, he opined.

Sreedharan touched upon how driverless cars could potentially reduce carbon footprint. If people start living outside cities, it means they will travel from outside the city, which will result in an increase in fuel consumption but will reduce carbon footprint in the city, he explained.

Sreedharan said autonomous cars have interesting advantages and challenges and it will require a huge amount of work before such are cars are widely deployed across the globe. “Automotive companies have to figure out how they can jump the castle – how you are going to manage it or adopt it. Price is a big thing in India and there must be a fundamental need created for people to use autonomous cars as adoption will not happen just because of a general want,” he concluded.

Tuesday, March 12, 2019

Telematics Steadily Making Inroads in Tractor Space

Telematics has been steadily gaining prominence in the automotive industry globally, going a long way in helping vehicle owners, especially fleet operators to not just improve turnaround time but also ring in a certain degree of accountability in the way the overall operations are run. The tractor space is increasingly looking to adopt telematics in a big way, as it paves the way for heightened productivity and weeds out any scope for argument between the contractor (deployed to operate the tractor) and the tractor owner over payment matters.

It is critical to point out that farmers in India are going through a difficult phase. Increasing fuel costs coupled with rising inputs costs like seed costs and fertilizer costs are resulting in increasing cost of cultivation. What’s more, the minimum support price (MSP) farmers are getting from the government hasn’t increased on desired lines, thus leading to immense pressure on the profitability of farmers. Thus, the bottom line is clear – farmers need to reduce their cost of cultivation and improve their yield.

With this in mind, Pune-based John Deere India – a subsidiary of US-based Deere & Company – has placed high focus on incorporating telematics in the Indian tractor space, rolling out the JD Link technology – a mobile app-based telematics solution through which customers can remotely monitor the health and safety of a tractor on a farmer’s phone. 

It is observed that customers that operate a fleet of tractors in India, often have to grapple with myriad issues such as fuel theft, detailed information of proper utilisation, etc as previously there was no scientific method to measure the acres cultivated that often led to ineffective fleet management . This is where the JD Link technology will come in handy as it not only improves productivity but also augments farmers’ income.

Further, the JD Link also enables customers generate various generate and store it for future use as well as receive automatic alerts in case of any malfunctions.

Algorithms for Autonomous Vehicles Take Decisions Based on Data

There is a great deal of buzz generated over autonomous vehicles or self-driving cars across the automotive industry globally. However, in the Indian context, there are reservations over adoption of autonomous vehicles or self-driving cars. The general line of thought is that autonomous vehicles or self-driving cars would end up eliminating jobs of drivers in a large way and India will not be ready with required infrastructure in years to come. Sharing his perspective on adoption of autonomous vehicles, Prashant Deshpande, Founder & Managing Director, EC-Mobility (a company that offers future mobility solutions in Advanced Driver-Assistance Systems (ADAS) and Autonomous Driving among others), said autonomous vehicles are no longer considered a futuristic dream and could turn into reality sooner than many among us probably think.

Given the transformations witnessed across the automotive industry, the EC-Mobility’s top official said going forward the industry will be hugely dictated by usage of software and data. Automotive OEMs and Tier 1 suppliers across the globe are working towards achieving Level Four and Level Five automation but how these levels of automation pan out remains to be seen, he noted.

The rapidly-evolving automotive industry will see data emerge as the new ‘oil’ and the onus will be on automotive companies to turn these data into value, Deshpande said. Vehicles in contemporary times need oil to drive but tomorrow it will need data to move.

Autonomous cars typically necessitate the need to perceive a situation or scenario and accordingly plan and act. Deshpande said the most important step is to interpret with precision if the user is launching any driver assistance feature, as it is critical to ensure data interpretation, as distinguishing between perception and interpretation holds the key. For algorithms to understand there is a need to carry out labelling and even that is not enough because algorithms has to take decisions based on data, Deshpande explained. It may be noted that tonnes of data are being generated in the automotive space. For autonomous driving or any driver assistance feature, every care must be taken to ensure data is correctly labelled and prepared for a vehicle’s algorithm to take the right driving decisions, the EC-Mobility MD observed.

In addition to box labelling, 2D semantic segmentation is another key focus area of autonomous vehicles. Deshpande said the vehicle’s algorithm will not be able to define a scenario in isolation unless semantic segmentation of that particular scenario is carried out.

He also threw light on semantic labelling for driver behaviour monitoring. “If a driver is sleepy or not adhering to traffic rules or driving instructions, one needs to look at his eye movements also. Eye tracking can be captured in a video. Interpreted data is valuable data and without data labelling one cannot make interpretations and without interpretations one cannot arrive at logical decisions,” Deshpande quipped.

Clearly, correct interpretations are critical and that explains why so much of data is captured in various scenarios such as day/night, rainy/snowy conditions and from various sensors like RADAR, LIDAR, Cameras, etc. Deshpande said all scenarios need to be captured in order to provide intelligence to data that will enable users to run algorithms for driver assistance features like lane departure warning, parking assistance, collision detection warning, etc. The machine or algorithm has to learn and such learning happens when learning data is provided to the machine or algorithm. Deshpande said it’s all about offering inputs to the vehicle’s algorithm and the algorithm will come to the conclusion that the pedestrian will cross the road or not based on the data that is available.

Deshpande said whether the vehicle’s sensor is performing correctly or algorithm is performing correctly can be determined by comparing trained and untrained data. In case the vehicle’s algorithm is not performing correctly and data is not labelled, a vehicle user will encounter driving challenges, he added.

Deshpande has no doubts that data is going to be crucial towards make L3, L4 and L5 a reality and this data has to be enriched every time one has new sensors, new cars and new situations. The need for refined data is equally important for autonomous cars. Deshpande said in scenarios where the vehicle has sensor data, there is a need to carry out annotation on the ground truth data and that is the value addition required. A process called ground truth labelling is used to annotate recorded sensor data with the expected state of the automated driving system. The test vehicle needs specialised software tools for labelling, annotation and for various other functionalities, he noted.

Deshpande said it is critical for autonomous cars to ensure control and execution as there is no way one can work in isolation, as one must have a perception where the data will be used and how critical is that aspect. There are tools available where in a guided environment one first does it manually, then perform semi-automation and then achieve automation, in terms of data annotation or data preparation, he noted.

Indian Electric Vehicle Ecosystem Can Leverage Type 2, CCS Charging Standards

The Indian electric vehicle ecosystem is still in its nascent stage and for EVs to thrive across the country, the availability of adequate charging infrastructure is the need of the hour. The talk of charging infrastructure also brings into focus what kind of charging standards the country should embrace if EVs are to be adopted on a large-scale across the country.

It may be worth recalling that in late 2017 the government came out with Bharat EV standards, namely AC-001 for AC charging and DC-001 for DC charging, on the recommendations of a committee constituted by the Department of Heavy Industry, and headed by Prof Ashok Jhunjhunwala. These specifications are meant to cater to the immediate needs of electric two-wheelers, three-wheelers and cars having battery voltage of less than 100 V. However, Bharat EV standards are seen as a more basic charging standard and are only currently adhered to by Tata Motors and Mahindra & Mahindra. The rest of the electric two-wheelers and three-wheelers plying in the country are out of this ambit, as they depend on their plug-in-at-home mechanism to meet their needs.

On the global front, the electric vehicle space is witnessing adoption of different charging standards across geographies. As far as Europe is concerned, Type 2 Connectors are used for AC charging and Combined Charging Systems (CCS) are used for DC charging. The CCS has gained acceptance in the US as well. CHAdeMO charging standards are widely prevalent in Japan, while GB/T charging standards are widely deployed in China. It is important to note that the Combined Charging System is currently used by the Volkswagen Group, Ford Motor Co, Daimler AG and General Motors Ltd in the US and Europe.

So what kind of charging standards would be ideal for the Indian EV market? A senior government official on condition of anonymity said Type 2 Connectors are very much workable for India. “Globally, many countries are using Type 2 Connectors and it would work for the Indian EV space for AC charging. But we need to figure out what standards we want to adopt for DC charging – whether we opt for controlled area network (CAN) or power line communication (PLC). Leveraging CAN means you have to use CHAdeMO or GB/T standards and using PLC means you have to use CSS. Vehicle users in India are familiar with CAN and knowhow to manage this network,” he said.

The senior government official further added that CHAdeMO or CCS standards are essentially designed for highway capable cars. It is too small to fast charge (carry out DC charging) two/three-wheelers or small cars and is too big to fast charge buses. If India has to leverage CHAdeMO or CCS standards for two/three-wheelers, small cars and buses, there is a strong need to adapt to it and maybe rejig if needed, he suggested.

Another senior government official said automotive OEMs must shoulder more responsibility in the EV charging space. He said there is reluctance among OEMs to get into the space of designing charging standards themselves. “Everything cannot be provided by the government. The government can facilitate charging stations on highways, but OEMs have to take the lead in designing charging standards themselves,” he said.

Welcoming the Power Ministry’s notification that anyone can set-up charging stations for EVs, the official said the move will work provided it is backed by intelligent and well-networked electric vehicle supply equipment (EVSE). “It is a good policy provided you are dealing with a network. However, if it is not a network and many people are tapping into the grid, it becomes difficult to manage the grid. Over the long run, a controlling software will be needed to manage the network,” he noted.

Akshaye Barbuddhe, Business Head, EV Charging Solutions, Delta India, said there is nothing called ‘ideal’ in terms for charging standards for EVs. As per him, all charging standards are ‘complete’ on their own, comprehensive and can work in any geography and demography. The global automotive industry is dictated by four forces – US, Europe, China and Japan and various charging standards have become prevalent in these nations due to certain merits and demerits of these regions, Barbuddhe said.

Elaborating further, Barbuddhe stated that Type 2 and GB/T standards can work to a nicety for AC charging in India. He was of the opinion that combined charging system (CCS) is the best ‘engineered’ and can fulfil most applications, thus paving the way for meeting dynamic business needs. Ideally, any charging solution will work anywhere and has to be the most versatile, most comprehensive, most engineered, most scalable that can make the business sustainable over the long-term.

Further, he advocated different standards for various vehicle segments. “It is a wide and open market and you cannot put everything in one block. There should be choices for end-users and it will be unfortunate if we don’t have a market of choices,” said the Barbuddhe.

The EV ecosystem in the country needs a proactive approach from all stakeholders and in terms of charging standards, government agencies such Niti Aayog, Power Ministry among others must spell out whether the country is looking to leverage the globally prevalent charging standards such as CHAdeMO, CCS and GB/T standards for the Indian charging needs or looking to expand the specifications of Bharat EV standards.

Steel Import Restrictions Could Hamper Automobile Production in India

The Indian automotive industry is going through a stress over the government imposing restrictions on domestic automotive manufacturers over using imported steel. It may be worth recalling that the steel ministry in a bid to promote local manufacturing had in June 2017 mandated Bureau of Indian Standards (BIS)-certified locally produced high-grade steel.

The ministry had set December 17, 2018 as the deadline to meet the new norms but was subsequently extended till February 17, 2019 after automakers were up in arms over the government move. In fact, auto companies sought an extension of the deadline until the end of 2019.

There is a great deal of unease in the Indian automotive industry over restrictions imposed on imported steel as there are apprehensions that the new regulations could disrupt the production of cars, government and industry. Even the automotive industry body - Society of Indian Automobile Manufacturers (SIAM) has been vocal about the restrictions on imported steel and has made its displeasure known in public domain.

In fact, Rajan Wadhera, President, Society of Indian Automobile Manufacturers (SIAM), said at a recent event that the import restriction issue needs to be sorted out at the earliest or else automotive production could get hampered.Automotive manufacturers have been voicing their reluctance to source locally produced source high-grade steel citing reservations over the quality and consistency of such locally produced steel. 

It is important to understand that a large chunk of the steel requirements for the Indian automotive industry is catered to by domestic steel producers. Around 90 % of steel sourced for domestic automobile production, is manufactured in India. 

The rest 10 % of high grade steel that is used for meeting safety standards among others, is not manufactured in India and sourced through the import route largely because there is no economy of scale to manufacture these in India.


It remains to be seen whether the steel ministry softens its stand on restrictions on imported steel or else automotive production may come to a standstill.