Financing remains a challenge for electric mobility in India: CII Report

Vehicle financing for electric mobility remains a challenge in India, revealing options to adjust costs and bring EVs closer to cost parity with internal combustion engine models, according to a CII report released on Monday. It is essential to

Developed in partnership with OMI, this report is part of a series of reports on the Future Mobility 2030 Roadmap.

To reap the benefits of Mobility as a Service (Maas), issues such as the classification of bicycle taxis and bicycles as commercial vehicles need to be clarified.

It also needs to highlight the benefits of rubber bands in terms of unloading, affordability (hence popularity) for users, and offering consumers greater choice, the report said.

Strategies promoting MaaS should ensure seamless integration and provide consumers with multiple options to provide the necessary impetus for shared mobility adoption, he said..

“Vehicle finance remains a challenge for electromobility as a whole. It is imperative to properly align costs and identify options that bring EVs on par with modern internal combustion engines,” the report said.
It also calls for the introduction of a disposal policy based on the need to remove end-of-life vehicles (ELVs).
“This rule will help create additional benefits for commercial vehicles wishing to transition to EV deployment.” Additional incentives for partners who do. We can reduce the principal of new vehicles, which in turn reduces the amount of interest paid by our vehicle partners,” the report said. It also recommended the creation of a “first loss fund” mechanism to help expand financing for EV purchases.
A first loss is a type of funding arrangement in which a lender transfers funds to a separately managed account traded by a manager. The manager is required to provide investment capital equal to her 10-20 percent of the total managed accounts, with the same amount usually provided by the first losing investor.
In this type of arrangement, the manager receives an increased performance fee of 45-80 percent of trading profits, but higher payout ratios often result in a management fee that benefits the first losing investor. and the fund manager is expected to absorb the initial loss. in case of loss.