With electrification booming in the automotive industry in the Indian market, we have seen many new startups emerging. In addition to this, the older automotive players have also revamped their lineup to not miss the bandwagon. Hence we have seen many new electric vehicles launched and other upcoming models being tested for the Indian market.
One such player is Renault and we have been hearing a lot of buzz and spoofs of them getting into electric vehicles in India. Recently CEO and Managing Director of Renault India, Mr Venkatram Mamillapalle in an interview with a leading automotive news firm gave us Renault’s EV plans for India.
In this interview, Mr Venkatram brought to light the challenges that they are facing with Renault EV plans and why is the French car maker reengineering its plans along with the sales trajectory. Below listed are some of the important points that give us clear answers on Renault’s EV India launch, the challenges being faced and growth and demand in sales.
Why is Renault delaying the launch of electric vehicles?
According to Mr Venkatram Mamillapalle, one of the most important aspects that Renault is focusing on is to not just make an EV but to develop a complete supplier ecosystem as well as other essential ecosystems to support their post-sales program. With this, he also addressed the problems that they are facing to develop this programme.
One of the major reasons is that we do not have a cell manufacturer in the nation, also we do not have 100 per cent of the necessary manufacturing infrastructure for electric motors in India. Some of the companies that are manufacturing these motors are doing it partially, which means that they also need to be dependent on other international parties for it. With this, there is a heavy shortage of battery makers and control modules as well.
In addition to this, the semiconductor shortage has also brought in many constraints as electric vehicles consume a lot of them. As India is heavily dependent on importing them, it is very difficult to localise the infrastructure completely soon.
Addressing these issues, Mr Venkatram Mamillapalle also highlighted that if they have to import the main system to manufacture an electric vehicle, hence there will be no cost benefit for the masses who will be owning them in the nation. Here Renault's goal is to first localise these modules as much as possible, which will not only make Electric Vehicles affordable in India, but also adhere to the true sense of MAKE IN INDIA as well.
When can we expect the Renault Kwid EV to be launched in India?
Addressing this question, Mr Venkatram Mamillapalle has cleared that they are developing and will be launching electric vehicles for the Indian market. But the timing for it can only be clear when the compliance and the cafe norms will fully kick in and they will help them get in a proper timeline for the launches.
With this, Renault also doesn't want to overburden Indian consumers with a product that needs a lot of modification. Hence they want to launch a proper EV which performs and functions in the right way and also in the meantime be brought in at the right cost that the customers can benefit from. This will also help the French car market to comply with the environmental norms and get the right product developed on the right platform.
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What led to the crash in sales during the month of May?
As of today, the demand that Renault is facing isn't going down, but with this, the major constraint they are facing is in the manufacturing to meet these demands. Also, these constraints to meet the volumes are because of the semiconductor issues that they are facing along with the pandemic lockdowns which were taking place both in China and India.
Having a look at the numbers in sales, we get to know that was due to the semiconductors that were available in the last three or four months. Explaining in depth Mr Venkatram Mamillapalle addressed that every product that was produced in these months has been completely sold off.
None of the inventory is being held at the manufacturing facility in stock nor do any of the dealerships have and pending stock being bottlenecked at their end. Hence the fall in sales is not due to lowering in demand or other issues related to the market but is wholly due to the unavailability and shortage of semiconductors in the market.
In the coming months, Renault is expecting the situation in the second half of the year to improve and to ramp up production to meet the growing demand. Once there is a steady supply of semiconductors and the other parts that rely on them, the French carmaker is confident that the production will ramp up at full speed and that there will be an increase in sales numbers as well.
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Is the worst over yet?
Looking at the growing demand and the improvement in the availability of necessary resources, the worst phase shouldn't repeat itself.
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What do the stats for the upcoming month look like in terms of sales?
With the help of the suppliers and the commitment and promises for good volumes in terms of resources, Renault looks positively to grow its production in the coming months. Especially with the festive season coming around the corner, they are ramping up production to meet the demands.
In the past couple of months, They have been restoring to fill up the pipeline hence providing favourable results. Although there will be a significant difference in the pre-pandemic and pre-semiconductor phases, but it should be better than the results seen in the first half of this year.
Mr Venkatram Mamillapalle is looking positively to the year 2023 with the growth and development in the current phase that there will be some kind of normalisation in the automotive industry which is facing issues due to shortage in semiconductors. With this, he is also hoping that there shouldn't be any problems caused due to the fourth or fifth wave of COVID-19 and that things will get back to normal.
Renault plans to develop the electric vehicle infrastructure from the ground up to pass on the benefits to the consumers. As of now, the important components that need to be developed for an EV have to be imported from various countries. Hence the French automaker wants to develop from the ground level to localise the production to reduce costs and develop a good platform for the masses.