Report on potential market of e-vehicles

Project Report On Market Potential of Electric Vehicles in Indian Market

Under the guidance of Prof. Saumya Mukherji Sir

Submitted by:by: Jayant Singh Raghav KH2008PGDMF128

Institute for Technolog & Management, Kharghar, Navi Mumbai ology Nav

Project Report On Market Potential of Electrical Vehicles in Indian Market By Jayant Singh Raghav Under the Guidance of Prof. Saumya Mukherji.

Acknowledgement Expressions have their own boundaries but this citation is an attempt to acknowledge the support given to me during the tenure of project. I would like to express my gratitude towards my Faculty guide Prof. Saumya Mukherji, for his timely steering. Without his valuable guidance this project wouldnt have been successful.

I am extremely grateful to sir for approving my Project & giving me the opportunity to complete this assignment under his able guidance. I am thankful for his counseling and help in facilitating smooth execution of this project. This assignment could not have been successfully completed without his sincere guidance. I am also appreciative towards other interns for their co-operation & sharing outlook.

Above all, I am thankful to the almighty Bhagwan for empowering me and ushering my way to sufficiently address my duties.

Executive Summary

Electric vehicle or E-bike or Eco friendly bike are getting attention for their environment friendly, convenient and economic fuel image. This mode of personal transportation is getting popular in India in recent years. India being a fossil fuel based country will look for non conventional sources of energy and fuel in coming times. EV can be a potential for India. The Indian government policies are also supporting their use. These vehicles are based on battery power as their fuel. The electric vehicle industry is in its introductory phase and there exist a oligopolistic market. The major players are Hero Electric, Yo! Bykes, Ace motors, EKO Bikes. There are many other major local players existing in market. Most of them did forward vertical integration. Hero electric is clear market leader with 67% of market share In this project report we tried to find out the target market of the product and extrapolated various variables to be studied in terms of consumers preferences. We looked into measures to reach right target market for these vehicles. The results are very interesting as the target market was bit hard to define so we took two-three parameters simultaneously in order to segment market. We studied it based on geography, their socio-economic needs and psychological needs .We found out people will prefer a battery operated vehicle for their children and other reason we find out was fuel efficiency and fuel availability. As these vehicles can be recharged anywhere and some are now coming with optional petrol tanks. Other thing is their simple functioning and easy to operate. The features of an e-vehicle that goes against are its bulky weight and battery disposal hazards. This report will be helpful for those new start-ups as the competition is also burgeoning as days pass-by in order to understand the psyche of the customers and will be able to provide them with better mode of transportation in coming future. We also focused on consumers brand awareness for e-vehicles and ways to increase in their awareness. We found out that customers are indifferent in terms of different brands as far as some new vehicles come in with different feature. We hope our work will help in the development of industry and will help in designing better solutions for society in coming days.

Contents Introduction1-3

Industry Overview..4-8

Research Objectives & Methodology............................. .....................................9-12

Interpretations13-23

Recommendations24-26

Appendices

Reference

Glossary

Introduction

Climate Change is the greatest global challenge of our generation. Challenges of this enormity require radical change that can only be delivered by completely new thinking. We are being forced to rethink how to sustain our current quality of life: the way we generate power and heat, our energy usage and consumption, the food we eat and how we produce it, the way we move around. Our current lifestyles and the associated emissions are simply no longer sustainable. This report proposes a plan to transform the way in which the two million vehicles in India are powered, to drive down emissions, improve efficiency and reduce costs. Its radical, viable and exciting. Transportation is the big problem area in terms of emissions in India. Not only does it make up more than 20% of our entire national emissions, it is by far the biggest growth area. Since 1990 transport emissions in India have increased by 165%; our commitment under Kyoto was just 13%. In 1990 we had 800,000 vehicles on Indian roads, 10 years later it was 1.3 million, now the figure is 2 million. Most commentators view transport as an impossible sector to tackle in terms of meeting emissions targets. I see it as the most exciting area to provide the solutions everyone needs. We need to get people out of vehicles, but also reduce the vehicle bone reliance of the vehicles that remain. Public transport and bicycles alone will not suffice, because of how and where we live. Biofuels have a role to play, so too do gas powered vehicles and possibly hydrogen engines. However the really exciting revolution will happen in battery powered electric vehicles. Make no mistake, this revolution will happen and has already begun. By linking electricity generation and management of the electricity grid with powering vehicles, we can create a new energy formula that can massively reduce our reliance on imported oil and the associated emissions. It is both feasible and realistic to see the complete replacement of petrol and diesel engine driven vehicles with electric vehicles within 15 years. The electric vehicles Im referring to will not be confined to the small, vehicletoon like designs that are currently available. These will be mainstream vehicles: big, safe, fast and comfortable; but powered in a different way. This is already happening abroad in many countries. Japan automobile industry is working over it for past few decades and will launch new vehicles in coming future. But will they be really successful. Answer is unpredictable until we know what are those clues on which consumers are derived to attain a new evehicle. We are here for extrapolating these facts.

Many Indian state governments are planning for the replacement of hundreds of thousands of vehicles within the next five years. Delhi government itself has started drive to use clean fuel. If this is to work, e-vehicle manufacturers must be aggressive and ambitious and target must be the complete replacement of oil powered vehicles. The electricity generation consequences of over a million vehicles, requiring batteries to be recharged, may sound like a barrier to progress. But in fact it is a new opportunity that can level the demand curve for electricity consumption and provide a new electricity storage system, in batteries, for use when the power is needed. India is bursting with natural resources that can be exploited to produce affordable renewable energy. We have better and more consistent wind speeds and large coast line. Governments various energy research projects are showing real promise. By linking the energy generation sector, particularly renewable, with fuel demand for transport, we are creating a symbiotic relationship between the two sectors that increases the viability of renewable, through storage of power, but also dramatically reduces emissions from transport. India, as an Island and a small country, has a competitive advantage over larger countries in terms of the capacity to transform areas of our economy quickly. We have a small and geographically isolated economy ideally suited to making a dramatic shift to electric vehicles. This is the choice: either we sit back and allow other countries take the lead in adopting electric vehicles and be a follower in the technology or we can be a leader in this new and rapidly growing global industry. Being a first mover in this area will not only reduce our transport emissions by up to 8 million tons per year, but it will also be the start of an exciting new industry employing tens of thousands of highly skilled people. Its not time to be hesitant. World should be ambitious to grasp the exciting opportunities that exist for India in the electric revolution.

Industry Overview

Enhancing the quality of life is the ultimate objective and the driving force behind many of the critical decisions we take. However, for this to happen, we as a community need to shift from individualistic mindsets and take responsibility for the environment we live in. It is only then that we would see holistic improvement.

Against the backdrop of environmental concerns and depleting resources, it is imperative not only to preserve what's left but find new alternatives to drive engines of growth in the economy. The effort, however, requires a collaborative approach by the government, regulatory authorities industry, R&D institutions and the community.

As a nation of keen minds, the answer lies in innovation, which has always been the force behind powerful changes in our times. This has been recently proven at the Asian Wall Street Journal awards. Out of the twelve finalists short-listed for the Asian Innovation Awards five of them were Indians, recognised for their inventions that improve the quality of life or productivity. These included an electric walking stick, modified pulley and energy efficient electric vehicles amongst others. The most sustainable invention recognised for applying technology to a strong business model and commercial potential has been the electric vehicles (EVs). EVs are the long-term solution to India's urban pollution and planning problem. Rise in economic activity and population has led to a tremendous demand in the transport sector especially in urban India. By 2020, India's population in cities is expected to grow fivefold to a staggering 200 million while pollution is expected to grow by seven times. With this tremendous growth has emerged a very critical issue of keeping air and noise pollution in urban areas under control. If we can have three Lakh Electric Vehicles on the roads by 2020, including three-wheelers, cars, and scooters, this could result in a reduction of over 16 Lakh metric tons of CO, NOx & HC by 2020, savings of over Rs. 3700 crores in foreign exchange and significant health costs savings. EVs are zero polluting, easy to handle and have low running and maintenance costs.

Small electric buses, three wheelers and electric scooters are ideal for city mobility in India but it could take between 5 and 10 years before they become viable for commercial use. Many local auto manufacturers such as REVA, Mahindra & Mahindra and Eko Scooters are embarking on alternate fuel transportation programs to combat air pollution in India. Apart from being environment and user friendly, there are several other reasons for alternate fuel cars to flourish in India. Firstly, electricity for EVs can be produced from various sources for which India has natural resources and does not need to depend on the import of oil. Although, EVs will not replace LPG, CNG or petrol and diesel for intercity use, the infrastructure required for EVs in the form of electricity distribution infrastructure is already available in all our cities and minimum costs are required to install additional. According to a research study conducted by the Freedonia Group, it is estimated that alternative fuel vehicles would reach global sales of over 1.6 million units and $39 billion by 2009. Battery technologies such as Sodium Nickel Chloride and Lithium Ion will increase the range of EV two to three fold. Fuel cells will remove this restriction altogether as they will be able to generate electricity instantaneously as soon as hydrogen is made available in cylinders at hydrogen filling stations. Next generation motors and electronics will reduce costs and increase performance by 15%. Battery leasing and selling of energy will further lower product costs and increase market share. Higher volumes of EVs will reduce costs by 1015%. India also has the maximum market potential for EVs owing to an established auto component infrastructure, low manufacturing and R&D costs, mechanical hardware availability, high urban congestion and the presence of a large domestic market. The industry could significantly gain from rising exports by 2010 and with appropriate government support, could transform the landscape of urban India by reducing pollution, improving public health, creating employment opportunities and impacting society. In spite of India being a hub for inventions of such technologies, EVs have not gained popularity owing to lack of adequate and timely support from central and state governments. Although, government has reduced the custom duty on three of the imported

components in battery operated vehicles to 10%, still the incentives seem too less for the price reduction of such vehicles. Other initiatives, which need to be taken to make the EVs affordable, include measures like relaxation in excise duty and VAT uniformity for the key inputs and components and also for the finished electric vehicle. In addition, in various countries, electric vehicles receive subsidies so as to promote the technology and reduce emissions. Similar initiatives should be introduced in India. Setting up a Technology Mission for EVs could also go a long way in supporting the development of EV technologies in India. China has established a Technology Mission with $106 million to have commercialised electric vehicles by 2008. The Technology Mission could support development of key technologies, development of infrastructure such as battery swapping stations and charging stations, support the development of prototypes/pilot and technology demonstrators, establishing a technology park and business incubation area, providing support for testing and certification for domestic sales and exports, single window clearance and support for administration and policy matters and introducing EV technical education at ITI, diploma and engineering degree levels. A holistic approach involving the government, public and auto majors is needed to promote Electric Vehicles in India. Appropriate government policies during the next five years and adequate support from business houses and institutions, for instance, purchasing a fixed percentage of vehicles for their fleets and offering subsidies and tax exemptions, will go a long way in promoting the industry in India. Finally, people have to become more informed about these technologies. The media must play its role in educating the public about alternate fuel vehicles and their advantages especially in the wake of spiraling prices of petroleum products and rising pollution levels caused by fossil fuels. Furthermore, by 2020 alternate fuel vehicles will be the order of the day. People's mindset, therefore, has to change from being individualistic to becoming responsible about the environment.

The Society of Indian Electric Vehicle Manufacturers (SIEVM) has drawn up a wish list for the Centre and various State Governments which includes infrastructure for common charging stations in cities and towns, subsidies for non-polluting vehicles as well as Government support for research and development. The Society currently comprises 13 electric vehicle manufacturers like Hero Electric, Mahindra & Mahindra, Electrotherm, Avon Cycles, Lohia Auto, BSA Motors, Lectrix Motors, Paradise Electro, Shubh Arya Steel, Crazye Bikes, ACE, Sinic Motors, Genex Power, Kabir Dass Motor, and 9 Electric Vehicle component manufacturers like Exide Industries, Freescale Semiconductors, Crompton Greaves, Axiom, Hinode Technology, Fiem Industries, Rotomag, NEC, and Texas Instruments, as members. We are ready to give technology and can even invest partially. But the need of the hour is Government support, said Mr Sohinder Gill, President of SIEVM and CEO, Hero Electric. An organisation representing electric vehicle (EV) makers and component suppliers, SIEVM came into being barely four months ago. Its 27-member pool comprises the likes of Hero Electric, Reva, Electrotherm and BSA, among others. The organisation is working on a 10point agenda to create a favourable environment for the electric vehicle industry so that it can grow like the Chinese EV market where 12 million vehicles are produced annually. SIEVM has also decided to make a formal representation to State governments seeking sops for non-polluting vehicles. Delhi is already giving 24 per cent subsidy to electric vehicles and we would ideally like other States to follow suit. There were at least 60-65 players at one time but 25 have already exited with another 20 tipped to join the list. By the end of the day, only serious players will remain in the business. Another major manufacturer, Ultra Motors, is not part of the SIEVM family and had, in fact, initiated moves for an association for electric vehicle makers, along with Reva and Electrotherm. However, this did not quite materialise. In the current fiscal, the electric vehicle market is expected to cross 1.1 Lakh units. Interestingly, it sees an opportunity in the economic slowdown. When there is a downturn, entry level products like electric vehicles end up gaining,

Research Objectives & Methodology

In our project we try to find out the market potential of the product and various variables to be studied in terms of consumers preferences. We will try to look into measures to reach right target market for these vehicles. Topic of the Project Study of market potential of e-vehicles and deciding factors for its purchase Objectives and Scope The purpose of this study is to find out that who are the potential customers of the newly introduced e-vehicles and define segments of customers that can be targeted. These newly concept based vehicles are demand of today as they are fit for environment and zero emission vehicle. Scope of study entails to have a wide view of the market attractiveness and the gaps need to be filled. The other major purpose of this study is to determine those determining attributes that enables the consumers to buy an e-vehicle. In defining the limit of the study, I have identified some study areas to be addressed as elucidated. A careful review of those question areas led to the development of the following specific research objectives. Research Objectives:1. Choice of e-vehicles is independent of Brand image of product. 2. Mileage (cost effectiveness) of the vehicle is given priority over other attributes. 3. The segments and attributes that differentiate them. 4. People are ready to pay more than 30,000 for an e-vehicle. 5. Brand image of e-vehicles is closely co-related with advertisements effectiveness.

Process Description Segmentation: On the basis of secondary research data we made the segmentation on the basis of: Product usage: 1. Short distance travel 2. For Kids purpose Product Benefit: 1. Convenient 2. Economical 3. Easy to ride Socioeconomic: Low and middle income group Geographic: Big cities, metros Tier-II cities Psychographic: Environment friendly vehicle Variables identified The customers of the e-vehicle might be looking for these following attributes Comfort Looks Battery performance Hassle free Charging Powerful driving motor Max Speed Cost effective at longer run Easy ride Eco friendly Safety And others we will be asking from the respondents at pilot survey.

Research Design Initially exploratory research method can be used to identify important attributes from secondary data. After that we will conduct a pilot survey. The size of pilot survey is taken as 25. We are using Google document will be used to conduct these surveys. Sample Design A survey of approximately 100 observation unit throughout the Kharghar and nearby region is to be provided as database for this study. The sample is selected on a convenient sampling. Eligible respondents are having a nick of two wheeler and e-vehicle industry and efforts will be made to interview the individual who is the most familiar with completing the survey forms. When there is more than one respondent a random process is used to select the respondent to be interviewed. Data Gathering The field work is to be done and a non random sampling survey was conducted. The survey was based on convenience. Questionnaire will be utilized to collect the data on face to face, through e-mail using internet. Google documents will be used to develop an online questionnaire and link was mailed to the various respondents. The survey is conducted to quantify certain factual information; certain aspects of information are also qualitative. Although I tried to conduct the survey free of any sampling error but there are certain errors which are inevitable. Response bias occurs when respondent tends to answer in a certain direction that is when they consciously or unconsciously misrepresent the truth. Auspices bias occurs when respondent bias in the responses of subjects caused by their being influenced by the organization conducting the study. Data processing & Analysis Standard editing & coding procedure will be utilized. Simple tabulation & cross tabulation will be utilized to analyze the data. Various hypothesis testing tools were utilized. Various statistical tools are applied to catch the essence of the data gathered during survey .Tools namely multiple correlation, regression, factor analysis are utilized to interpret data.

Interpretation

Sample size For any kind of business research it is necessary to estimate the size of sample necessary to accomplish the purpose of study. In the following research conducted the sample size was calculated using an online sample calculator. This leads us to conduct a survey and collect the sample of at least 96 samples.

Source: http://www.surveysystem.com/sscalc.htm

Fig: Snapshot of the webpage where sample size was calculated. No of samples collected = 100 Frame of questionnaire Questionnaire consists of only close ended questions. Size of questionnaire is 10 questions .Asking about various parameters related to their buying nature and their inclination towards one product. The Questionnaire follows tunnel technique with general questions to more specific questions in order to obtain unbiased response. It also helped in understanding and knowing about responders frame of reference by asking more specific questions about the respondents information. No filter questions and pivotal questions were asked in the questionnaire (see Appendix - A1).

Questions were set on various scales namely nominal, rational and ordinal. We tried to keep the questionnaire as succinct and resourceful as possible .Nominal scale is used onnaire to know the average thinking of the consumer .Every variable was tried to include in the questionnaire.

We asked our respondents following questions and got re ponses which are described in responses descri the form of tables and graphs with each questions Customer awareness about e-vehic was an important point that we tried to clarify through vehicle this survey. We wanted to know that whether customers are responsive of the developments in this industry & what brands they are aware of. To our amazements customers are well aware of various brands available in the market. Instead Yo! Bykes and Hero Electric enjoyed highest brand recall. Reva Electric is another brand among most recalled brands. Graph-1 shows the customers recall for various brands. 1

Brand Recall100 90 80 70 60 50 40 30 20 10 0 Hero Electric Yo- Bykes Electrotherm Ultra Motors Ace Motors Respondents

GRAPH-1

We asked about the most important feature that they look for in an e vehicle, and this is e-vehicle, what we found out

Most Preferred Feature100 90 80 70 60 50 40 30 20 10 0 Heavy duty Battery Looks Comfort Ride Safety Powerful Motor

Respondents

GRAPH-2

Graph-2 shows that people look more for a heavy duty battery and comfort ride among 2 many other features. Looks and safety comes after them. This was expected also since past electric vehicles were notorious for their low battery efficiency and less comfort ride. Today companies like Electrotherm and Ace motors are working with some foreign giants on high battery life and speed. These features will be the future cues for the customers to buy a new electric vehicle. We wanted to know that what are the various reasons that can compel them to buy an e ebike. In our survey form we gave them options like cost effective solution for commuting, safer ride for children. Environmental consciousness etc. We found out majority of people will look at these vehicles in future as a cost effective solution for commuting shorter distances.

Graph-3 shows the percentage wise division of the consumers for various options given to 3 them as reason for them to buy an e e-vehicle in future.

Reason to buy a new e-vehicleEasy to ride Safer ride for Children Cost-effective Value for money Environment conscious Others

GRAPH-3

After this we wanted to know that what is the main mental obstruction that keeps them away for buying it. We found out

Reason for not buying

Low max speed Kid's Ride Battery Charging Hassle Poor Service Network Other

GRAPH-4

The major reason behind it is the maximum speed limit that these kind of vehicles have to offer. The maximum speed limit is 45-60 Kmph in most of the vehicles which is the major 60

hindrance for the customers. Other major impediment for customers is poor servicing network. These vehicles have special engineering so needs special training for a mechanic. No any roadside mechanic could deal with these vehicles. If a vehicle breaks down it has to be carried to the authorized service centres only and those again are very small in number.

Another important aspect of these vehicles is price that they are being offered at. We asked in survey form about the cost customer would like to bear in order to own one of these e evehicle i.e. customers perceived v value. We were astounded to know that people are ready . to shell out large amount of money if these vehicles fulfill their wish list.

16-20 Thousand 21-25 Thousand 26-30 Thousand Above 30 Thousand

GRAPH-5 We asked them if they are ready to leave their last vehicle in order to use a new electric vehicle. The question was bit tricky as consumer became more defensive in giving the answer. This question was based on sementic differential scale so that we could come to know the general conception of the future potential customers. The observation says the

Will they buy an e-vehicle in near future?100 90 80 70 60 50 40 30 20 10 0 Very much I guess so Indifferent Might be Not at all

GRAPH-6 that most of the customers are more or less ready to change their vehicle to get a new electric vehicle in near future. These answers may be biased because customers get aware of survey till then. But still most of them said they will be ready to own one in near future.

Hypothesis Testing We created certain hypothesis based on our research objectives and applied certain test to prove them. We found out that only few of them are acceptable, remaining created new information altogether. We identified some variables listed in foregone pages. We asked respondents to rate each of them on the scale of five, which they think is the most important and which not to each of the variables. These variables data is again large so in order to reduce data we perform factor analysis and tried to combine some of the variables into one new dimension.(For detailed calculation look for Appendix A-3). We found out following factors.

Factors Table S. No. 1 2 3 Factor Name Vehicle Performance Engine Efficiency Utilities Variables combined Comfort , Looks, Easy Ride, Safety Battery performance, Motor Power, Maximum Speed Charging Hassle, Maintenance Cost, Eco-friendly

We wanted to know is there any correlation between the consumers propensity to buy any of electric-vehicle and various variables. And if yes, what is the mathematical relationship. We tried to derive a mathematical equation based on the above reduced factors and complete variables. Using SPSS 16.0 we found out that these factors define the entire population in efficient manner and no. of outliers are very less. And observations are normally distributed along a straight line

Looking at SPSS output and co-efficient table we found out that the Stadarised coefficient for the Factors which are named as Vehicle Performance, Engine Efficiency and Utilities respectively will have following coefficient.

S. No. 1 2 3

Factor Name Vehicle Performance Engine Efficiency Utilities

Standarised Coefficient Values -0.625 -0.619 -0.314

So Regression model for calculating the consumers propensity to buy a new e-vehicle is

P = -0.625F1 + (-0.619)x F2 + (-0.314) x F3Where: P = Propensity to Buy F1 = Score for Vehicle Performance F2 = Score for Engine Efficiency F3 = Score for Utilities

Hypothesis:1 Choice of e- vehicle is independent of different brands available in the market Hypothesize: Since it is well acknowledged that brand name plays important criteria to select any vehicle we tried to prove the same for e-vehicles also. So null & alternate hypotheses are H0 : Choice of e-vehicles is dependent on the brand image H1 : Choice of e-vehicle is independent of the brand image

Test: Since we are testing the behavior of consumer on two variable i.e. the brands they use & effect of brand name on their selection for a particular e-vehicle, it is quite evident we will require a chi-square bi-variate test. 2 = (o e)2/ e : type 1 error rate is taken as 0.10. Since the test is two tailed and = 0.10, there is /2 = 0.05 area in each of tail of distribution. Thus rejection region lies at two ends of distribution curve and acceptable region is 90% of total area which is lying symmetrically on both sides of the mean mean value. The degree of freedom for the hypothesis testing is 11. 2/2 = 9.8376 df = 11

Gathering data we can calculate the expected values. Calculating the value for the 2 we found out it comes under the acceptance region defined. 2 calculated = 4.07018*

for calculation see appendix

Action: Because this test static, we found that calculated value is coming very much inside the limits of acceptance region so null hypothesis is not rejected. That is the brand image is affecting a consumers choice and an important step in product selection.

Hypothesis:3 Consumers are ready to pay more than 25 thousand to own such a vehicle.

Hypothesize: We are trying to estimate whether the consumers are ready to pay a large sum in order to get a bathroom of their dream and ready to embellish the clandestine part of their house. H0 : Consumers are not willing to pay a large sum for bathrooms H1 : Consumers are willing to pay a large sum for bathrooms

Test: Applying Z test for testing population mean checking its validity. It is one tail test. Z = ( x - )/(/n) taking = 0.05 We have tabulated value of Z Ztab = 1.96 Calculating Sample mean x = 109375 Sample standard Deviations = 43448.56 Taking random samples for calculating population mean No. of samples taken = 25 Population mean = 107000 Zcal = 0.535

Recommendations

E-vehicles would definitely hold potential for the markets like India if the companies were able to gauge the needs and demands of the target audience and keep on continuously make changes and innovating their offerings. Country like India which is still not self sufficient in the field of fuel will have to accept and adopt the new ways of transportation if not now then in coming years but this is bound to happen. Automobile Giants like Honda and Ford have already launched their prototype hybrid vehicle in the country but still it has a long way to go. Out of our findings we would like to recommend following points to all automobile manufacturers in order to target audience in right manner. 1. Customers look for long battery life and hassle free charging of vehicle in their future vehicle. This could derive their whole marketing campaign by innovating and irritation free battery charging and durable batteries. 2. Target customers can be divided using their usage. Here customers are looking for this vehicle as solution for their individual needs. Whether that is their psychological need or their social or personal requirement. Companies have to use one mile marketing and try to design local campaigns to offer.

3. Companies should also concentrate on the training of local mechanics and have to build strong service network. Since these vehicles are still new in the market their engineering needs to be explained among the workshops. 4. Other important doubt in the minds of the customers is the availability of auto parts. The customers are looking for reliable auto parts of the companies. Companies have to make it sure the timely availability of the genuine auto parts

5. Companies can go for country level research studies and can derive mathematical relations like one developed in here in this study to find out the propensity level of the customer to buy a new e-vehicle.

6. Companies should also look for safety features of their vehicles and try to generate confidence among the users. These vehicles are not known for reliability and long rides. Long rallies and eco-friendly message will give boost to these vehicles market. 7. SIEVM should try to co-act and try to persuade government to make market more conducive for the companies and vendor companies. They should try to make policies that should be more fruitful for all the stakeholders.

Appendices

Appendix-A1Questionnaire:Name: .. Occupation: . Place: ....................... Email id: .. 1. Your Age Group? a. 15-20 b. 21-25 c. 26-30 d. above 30

2. What is your annual family income? a.3 5 Lakh b. 5 7 Lakh c. 7- 9 Lakh d. Above 9 Lakh 3. Are you environment conscious? a. Yes b. No 4. Which branded e-vehicle will you buy in future? a. Hero Electric b. Yo- Bykes c. Electrotherm d. Ace Motors 5. Are you ready to use an e-vehicle in place of your fuel driven vehicle? a. Very much b. I guess so c. indifferent d. might be e. not at all

6. Does brand name of vehicles affect your choice? a. Yes b. May be c. Not at all7. What will you look for in an e-vehicle? a. Heavy duty Battery b. Looks c. Comfort d. Safety e. Powerful motor 8. What will be the reason for your e-vehicle purchase? a. Easy to ride b. Safer ride for children c. Cost-effective d. Value for money e. Environment conscious

9.What will be your reason for not using an e-vehicle? a. Low max speed b. Kids ride c. Battery charging hassle d. poor service network e. .

10. Will you buy an e-vehicle from a branded co. in future? a. Absolutely b. I think so c. Indifferent d. might be e. No How much are you willing to pay for a new e-bike? a. 16-20 Thousand b. 21-25 Thousand c. 26-30 Thousand d. Above 30 Thousand

11. Rate following features of any e-vehicle out of 5 Features Comfort Looks Battery Performance Charging Hassle Motor Power Maintenance Cost Easy Ride Eco Friendly Safety Mark out of 5

12. Any comments:

Appendix A-2Factor Analysis SPSS 16.0 OutputTable :KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. Bartlett's Test of Sphericity Approx. Chi-Square Df Sig. .519 263.347 94 .000

Table: Communalities Initial Comfort Looks Batt_Per Char_Hass Max_speed Motor_Pow Easy_ride Maint_cost Eco_friendly Safety 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Extraction .632 .316 .718 .479 .724 .833 .878 .820 .610 .658

Table: Rotated Component Matrix Component 1 Comfort Looks Batt_Per Char_Hass Max_speed Motor_Pow Easy_ride Maint_cost Eco_friendly Safety .670 -.542 .100 .308 -.014 -.032 .928 -.041 -.023 .798 2 .060 .053 .807 -.185 .850 .912 -.040 .158 .171 .126

a

3 .423 .141 .237 .592 .021 -.028 .124 .891 .762 .068

Extraction Method: Principal Component Analysis.

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser normalization.

TableComponent Score Covariance Matrix Component 1 2 3 1 1.000 .000 .000 2 .000 1.000 .000 3 .000 .000 1.000

Extraction Method: Principal Component Analysis.

Appendix A-3Regression Analysis:

Coefficients Unstandardized Coefficients Std. Model -1 (Constant) B 4.033 -.580 Error .111 .111 -.625 Beta T 27.437 -.991 Sig. .000 .026 Standardized Coefficients

a

95% Confidence Interval for B ZeroLower Bound Upper Bound 4.812 -.534 3.855 .013 -.125 -.131 order Partial Part Correlations

Colline

Statis Toler ance

score 1 for analysis 2

-.125 1.000

score 2 for analysis 2

-.529

.111

-.619

-2.051

.045

-.452

-.005

-.259

-.264

-.259 1.000

score 3 for analysis2

-.334

.111

-.352

-1.203

.034

-.357

.089

-.152

-.159

-.152 1.000

a. Dependent Variable: Propensity

Research Calculations Hypotheses Calculations Hypothesis-1Responses to e-vehicles prefer to buy in future Table:1 Electrotherm Ace Motors Hero Electric Yo-Bykes Total

46 16 6 28 96

Responses to effectiveness of Product brand of e-vehicle over consumers choice Table:2 Yes 54 May be 20 No 22 Total 96 Calculating expected value

Calculation of 2 (0 - e)2 / e 1.45 0.26 1.96 0.11 0.13 0.03 0.01 0.10 0.02 4.07018

Applying Chi square goodness of fit test Let = 0.10 or /2 = 0.05 Degree of freedom = 11 Effect Ace Motors 9.00 3.33 3.67 16.00 Hero YoElectric Bykes 3.38 15.75 1.25 5.83 1.38 6.42 6.0 28

(0 - e)2 37.52 2.51 20.63 1.00 0.44 0.11 0.14 0.56 0.14 (0 - e)2 / e

Brands Electrotherm Yes 25.88 Maybe 9.58 Not at all 10.54 46.00

54 20 22

Reference1. Naresh K. Malhotra, Satyabhushan Dash Marketing Research-an applied orientation-5th Edition Pg.- 552, 561-566, 613-619, 2. William K Zigmund Business Research Methods Pg.- 111-122, 175-196, 309-320 3. Vandana Gombar - Beat the fuel hike, buy an electric car! (article) Economic Times dtd. June 5 2008 4. Wheels unplugged -E-vehicle manufacturers society formed in India (news article) Business Standard 5. wheelsunplugged.com 6. surveysystems.com

GlossaryAdvertising Any paid form of non personal presentation and promotion of ideas, goods, or services by an identified sponsir Brand A name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or servicesof one seller or group of sellers and to differntiate them from those of competitors, Brand awareness all the thoughts, feelings, images, experience, beliefs, and so on that become associated with the brand. Brand image The perceptions and belief held by consemers, as reflected in the association held in consumer memory. Branding Endowing the products and services with the power of brand. Competitive adventage A companys ability to perform in one or more ways that competitors can not match. Core Values the belief systems that underlie consumer attitudes and behavior, and that determine peoples choice and desire over a long term. Core competency attribute that is a source of competitive advantage in that it makes a significant contribution to perceived customer benefits, has applications in a wide variety of markets, is difficult for competitors to imitate. Cues stimuli that determine when, where, and how a person responds.

Customer perceived value The difference between the prospective customers evaluation of all benefits and all the cost of an offering and perceived alternatives.

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Delivery how well the products or services are deliverd to customer Drive a strong internal stimulus Image the set of beliefs, ideas, and impressions a person holds regarding an object. Loyalty a commitment to rebuy or re-patronise a preferred product or service.

Marketing communication mix advertising, sales promotion, events & experience, public relation & publicity, direct marketing, and personal selling Marketing research the systematic design, collection, analysis, reporting of data & findings relevant to a specific markeitng situation facing to the company. Media Selection finding the most collective media to deliver the desired no. and type of exposure to the target audience. Perceived value the value promisecby the companys value proposition and perceived by customer Perception the process by which an individual selects, organizes, and intercepts information inputs to create a meaningful picture of the world Performance quality the level at which products primary characterstics operate Product assortment the set of all products and items, a seller offers for sell. Product mix same as product assortment Satisfaction a persons feeling of pleasure or disappointment resulting from comparing a products percieved performance or outcome in relation to his or her expectations.

SCM procuring the right inputs and converting them into finished products; and despatching them to the final destinations. Target market the part of qualified available market the company decides to pursue. Value delivery network a companys supply chain and how it partners with specific suppliers and distributors to make products and bring them to market. Value pricing winnig loyal customer by charging an offordable price for a high quality product. Viral marketing using the internet to create word of mouth effects to support marketing efforts and goal.

Source: Marketing Management by Phillip Kotler & Kevin Lane Keller