India’s mobility industry is on a trajectory to exceed $600 billion by 2030, propelled by the increasing adoption of electric vehicles (EVs), the rise of innovative mobility models, and significant shifts in consumer behavior. This projection is detailed in the “Think Mobility” report, a collaborative study by Google and the Boston Consulting Group (BCG), unveiled at the Bharat Mobility Auto Expo.
Surge in Electric Vehicle Adoption
The report highlights a notable surge in the consideration of EVs among Indian consumers, with one in three prospective buyers contemplating an electric vehicle for their next purchase. However, preferences vary distinctly between electric four-wheelers (E4Ws) and electric two-wheelers (E2Ws). E4W buyers are inclined towards advanced technology, sophistication, and exclusivity, whereas E2W consumers prioritize practicality, comfort, and affordability.
A significant demographic shift is also influencing the EV market. Women now account for 52% of purchase decisions in the EV segment, a substantial increase from 38% in the internal combustion engine (ICE) vehicle segment. This change underscores the growing influence of female consumers in shaping the future of mobility in India.
Emergence of New Mobility Models
The Indian mobility landscape is experiencing a transformation with the advent of electric, shared, and connected mobility solutions. These emerging models are projected to contribute an additional $100 billion to the industry, reflecting a significant shift in consumer priorities towards sustainable and efficient transportation options.
Vikram Janakiraman, Managing Director and Senior Partner at BCG, emphasized the necessity for industry players to adapt swiftly to these evolving consumer demands. He stated, “Successful players will need to study and frequently adapt their product, solutions, and experiences to suit these unique needs; integrating digital, tech, and AI will be critical to doing that.”
Influence of Gen Z and Digital Purchase Trends
Gen Z consumers are emerging as a transformative force in the mobility sector. They are 2.7 times more likely to opt for self-drive rentals compared to older generations, indicating a preference for flexible and personalized mobility solutions. Additionally, 85% of users engaged in self-drive rentals and subscription models have expressed interest in eventually purchasing the vehicles they rent, highlighting a potential pathway for vehicle ownership.
The digitalization of the purchase journey is also gaining momentum, driven by a growing demand for personalized experiences. Bhaskar Ramesh, Director of Omni Channel Businesses at Google India, noted, “From pre-purchase to in-vehicle experiences and after-sales services, we see immense potential for AI to deliver meaningful experiences and create real value for consumers. We’re excited to collaborate with the industry to drive innovation and growth in this space.”
Shifting Perceptions of Pre-Owned Vehicles
The report identifies a changing perception towards pre-owned vehicles among Indian consumers. Currently, one in four first-time car buyers is considering a used car, with lifestyle upgrades emerging as a key motivator rather than mere cost-saving. This trend indicates a maturing market where consumers are open to diverse ownership models to suit their evolving needs.
Strategic Imperatives for Industry Stakeholders
As India stands on the cusp of transformative change, effectively harnessing global innovations in EVs, digital technologies, and artificial intelligence is more critical than ever for Original Equipment Manufacturers (OEMs). Natarajan Sankar, Managing Director and Partner at BCG, advised, “To succeed, they must align their offerings with the distinct demands of Indian consumers.”
The “Think Mobility” report draws from comprehensive research, including insights from over 10,000 consumers across various Indian cities, interviews with industry experts, and analysis of market trends. The findings underscore the dynamic evolution of India’s mobility sector and the myriad opportunities it presents for stakeholders committed to innovation and consumer-centric strategies.
In conclusion, India’s mobility sector is poised for substantial growth, driven by technological advancements, changing consumer behaviors, and the emergence of new mobility paradigms. Stakeholders who proactively adapt to these trends are likely to thrive in this rapidly evolving landscape.
