Fire incidents in electric vehicles unlikely to impact EV sales in long-term: Crisil

Mumbai: The recent fire incidents in electric vehicles are unlikely to have any long-term impact on the sales of EVs in the country, but there could be an immediate perception that whether these vehicles are safe or not, credit rating agency Crisil said on Tuesday.

There has been a spate of incidents where electric vehicles have caught fire, with the recent one reported from Nashik in Maharashtra — where 20 of the 40 electric scooters caught fire on April 9 when they were being loaded in a container.

Earlier in March, about four incidents of electric scooters catching fire, including in Okinawa and Ola, were reported from different places in the country, prompting the government to order a forensic investigation.

”It may have a near-term impact which is a little negative but over the long-term, I don’t think this is going to be an impediment (in EV sales). This is a new age industry and any such industry will find teething issues,” said Hemal Thakkar, Director at Crisil, at a webinar on Tuesday.

He said the EV industry globally has 7-8 players who dominate the market whereas in India there are some 25-30 companies and startups, which are into the manufacturing of two and three-wheelers. So, the market is largely dominated by 2/ 3-wheelers, Thakkar said.

“So, of course, the kind of process they have at their end they will also go through the learning curve. And the industry will take some time to attain maturity,” he added. However, ”From an immediate perspective, there could be a perception that could be developed that whether these vehicles are safe or not,” he said, adding the government has already set up an independent probe as far the recent fire incidents are concerned to find out the cause or reason behind these incidents. ”These are teething issues. We feel, maybe, in the near-term, we could see some challenges,” he noted.