Mahindra Group CEO Anish Shah at WEF 2024: 'Hybrid is a short-term solution, EV has to be the future'

The electric vehicle ecosystem will develop very rapidly in India as we have the right set of incentives, said Mahindra Group MD and CEO Anish Shah on Tuesday. He also said that the hybrid model is a short-term solution and that his company's focus is on pure electric vehicles.

"If you look at countries around the world. Hybrids came in 2000 and they were effectively for CAFE (Corporate Average Fuel Efficiency/Economy) norms in those countries. None of those countries provided incentives for hybrids, and that is essentially because hybrid is a short-term solution," Shah said while speaking to Business Today's Executive Director Rahul Kanwal and Business Today TV's Managing Editor Siddharth Zarabi at the WEF 2024 in Davos.

"You've got two power trains in the car - electric powertrain and combustion engine powertrain. That's not an efficient solution. Why does it work? Because if you don't need charging stations but to set up a strong EV infrastructure, you need to be all in EV. You need to be able to invest there, get the cars on the road."

Shah said that Mahindra and Mahindra had a choice to make two years ago. "Our choice was let's have a couple of hybrids and a couple of EVs, and the choice we took is that that does not work because you need to go all in on EV, deliver a very high number of electric vehicles that creates a charging infrastructure, and that creates a future we want. Because the future has to be around electric, that's going to be a much more efficient future."

Hybrids are fuel efficient by only about 10 per cent, but emissions are the same, the top executive said. "It's really no difference in emissions. So from that perspective, EV has to be the future."

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When asked about the EV ecosystem in India, Shah said that Mahindra is developing five new SUVs, which he said are truly exciting. "It's going to change the game. So once that comes in, you start seeing a greater focus on infrastructure because you do need to have cars on the road to have infrastructure there," he said.

"And we feel that we should be at about 30% of our production being EVs in the next three years by FY27, and by FY30, we want to make a million EVs for India and the rest of the world," he said while speaking about the electric vehicle ecosystem in India.

When asked about the requirements of obtaining permission from local authorities to set up a charging station as one vehicle had caught fire in Mumbai, Shah said the safety is the most important aspect. "And as we're building our cars, that's one thing we're making sure is that the battery chemistry - how the protection is set up for the batteries ensures a very safe car because we can't afford to take a step forward and two steps back."

So in some ways, he said, the carmakers have got to do it the right way. "Yes, there is work that's required from manufacturers and regulators, but I feel it's happening at the speed that it needs to."

When asked about his views on driverless cars in India, Shah said: "It's Way off in the distance. I would say that India is definitely not going to be at the forefront of that. We shall wait to see how others adopt that first, and then we will look at that from an Indian perspective. Technology does exist, but it's not perfect right now either. So I just say, wait and watch on that."