- Date : 11/11/2021
- Read: 5 mins
Understand an electric car's pricing, range, battery life expectancy, insurance, tax incentives, etc., in this article before you buy one.
Electric Vehicles (EVs) have become the talk of the town these days. With EVs gaining massive popularity and EV subsidies offered by the government, market reports estimate a 26% rise in electric cars sale between 2022 and 2023. Even though the price of electric cars in India is high, consumers' inclination towards eco-friendly vehicles is increasing with each passing day.
Why is that? The primary reason is the sustainability that electric cars offer. For one thing, you save on insurance and maintenance costs. In some states, you may get certain incentives and benefits if you own an electric car.
Are you considering buying an electric car? Here’s what you need to know.
What to consider before buying an electric car?
So you have decided to join the 5.6 million people worldwide who have ‘gone green’ by using electric cars. But you may not have thought of all the aspects associated with buying and running such a vehicle. To make the decision easier, here’s a list of things you should consider:
1. Price of electric cars in India
Electric vehicles are comparatively cheaper in the US than in India. For example, a Tesla Model S is expected to cost Rs 1.5 crore in India, whereas it is only about one-third that amount ($69,420) in the US.
The reason behind this surge in price is the use of cobalt in the car's batteries. Experiments are underway to replace it with nickel, which can reduce the final cost. However, it will take some years for the process to be effective.
For example, a Tata Nexon EV costs Rs 13.99 lakh, but its non-EV counterpart is just Rs 6.99 lakh!
2. Insurance for electric vehicles
Electric cars in India require insurance because of the expensive repair bills that can occur. Moreover, the higher the cost of these vehicles, the more insurance you would have to pay. When compared to conventional cars, you will find insurance costs to be extremely high.
According to Financial Express, premium rates for electric cars have been lowered by 10%-15%. But you still need to understand the cost of insurance before investing in an EV. For example, a car with 65kW output will have an insurance premium of Rs 6700 or more. A 30kW battery can set you back by Rs 2700.
3. Tax incentives for electric cars
As per Section 80EEB of the Income Tax Act, you will get a tax benefit from the government if you have taken an auto loan to purchase an electric car. The Act states that you get tax deductions if you pay interest up to Rs 1,50,000 on the car’s price.
This reduces the overall price of your EV. So, you need to look for the exact tax benefit percentage on the car you are about to purchase. The GST is also less, which might lower the final cost of your car.
4. Life expectancy of EV batteries
The battery is arguably the most crucial component of an electric vehicle. And batteries tend to be extremely expensive. Due to this, replacing them regularly can be a financial burden on top of the car’s cost.
So, what do you do? Before buying an EV, you should always ask about the battery life expectancy. A larger capacity battery will also reduce the need for frequent recharging.
In India, an EV battery can last anywhere between six to eight years, after which it will require replacement. A report suggests that Lithium-Ion batteries can last 500 to 10,000 recharge cycles in India.
5. Availability of charging stations
Unlike the ubiquitous fuel pumps, EV charging stations in the country are few. According to NDTV, India only has 427 EV charging stations spread across states. This is currently one of the biggest challenges for electric car owners.
Finding an effective charging station in India can be a hassle if you live in the heart of the city because 77 of them are on highways. Furthermore, around 350 electric car charging stations are located in just seven states and two union territories.
Though major metro cities like Delhi or Mumbai have some charging stations, smaller cities might not. So you need to identify the nearest charging stations before investing in an electric vehicle.
Government incentives for EV owners
You can save money and avail of some incentives, depending on the state you live in. Here is a list of the incentives you can gain from government subsidies:
Related article: What is Vehicle Scrappage Policy and How Does it Affect You?
Prices of some electric cars
Here are some electric cars you can choose from:
Owning an electric car in India comes with its share of challenges, so it is advised to do your research before buying one. Things to check include the purchase price and insurance premium, government tax benefits and incentives, availability of charging stations, and the battery life expectancy of your chosen vehicle.