Abstract
Government of India has adopted policies to grow the share of electric vehicles (EVs) to ‘de-carbonize’ India's transport sector and reduce import dependence for oil. For the lower-middle income economy two-wheelers play a significant role in the private vehicle market. This paper focuses on the effectiveness of some of the demand incentives; roles of infrastructure, market visibility; and peer effects on acceptance of electric two-wheelers in India. It utilizes a discrete choice survey to collect responses from Indian residents. Respondents in six different choice scenarios chose between two categories of petrol vehicles and an EV. Results from the random-parameter logit model indicate that price, refueling time, availability of infrastructure, vehicle taxes, and fuel prices are significant determinants of two-wheeler choice. Further, estimates suggest that consumers are willing-to-pay INR 567 to save in fuel cost by INR 1 per 100 kms, INR 997 for every percentage point reduction in taxes, INR 316 to save an additional minute of charging time, and INR 879 to increase the charging infrastructure by an additional percentage point. Government policies involving price subsidies, preferential tax treatments and improvements in infrastructure should continue. Differential pricing of petrol and electricity can also make electric two-wheelers more attractive.
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