Skoda to Launch Affordable Electric Car in India worth INR 20 lakh

Skoda Auto, a member of the Volkswagen Group, has officially revealed it is planning a new, reasonably priced battery-operated model for the Indian market. The Volkswagen Group has already expressed its ambition to offer electric cars (EV) in India. At a ceremony to celebrate the automaker's debut into Vietnam, a senior Skoda official claimed that the business must launch an entry-level battery electric vehicle in India. He made this statement while talking to bike & car and another Indian automotive outlet. Following the introduction of the all-electric Enyaq, a brand-new EV is slated to follow. Skoda is aiming for an aggressive pricing of under INR 20 lakh for the brand's most inexpensive EV.

"We have to bring an entry BEV to India. According to Martin Jahn, director for sales and marketing at Skoda Auto, "We will now be introducing Enyaq, which is a high-end car, but an entry-level BEV or less expensive BEV than Enyaq, it is an absolute necessity for us in India."

While stating that it is still very much possible to create electric cars in India today, despite the nation still needing to rely on imports for critical EV components, Jahn said the automaker is presently analyzing "several potential partnerships".

Although Skoda has not yet decided on the design for its entry-level EV, the firm is in discussions with other producers about possible collaboration. It is also considering the idea of adapting and localizing the VW Group's MEB architecture.

"We are investigating options for the entry EV's architecture; it could either have the MEB tweaked [modified] or it might be in collaboration with another company. As a result, it would have to cost somewhere between €15,000 and €20,000 (about INR 13–18 lakh)," Jahn added, teasing the new EV's price range.

While he refrained from naming specific companies, it is known that the Volkswagen Group and the Indian automaker Mahindra are in discussions on a potential partnership that might lead to the co-development of affordable EVs for the Indian market. Skoda continues to oversee Group activities in India, and there is a chance that the Group would use Mahindra's recently created INGLO architecture for its upcoming vehicles.

To achieve its ambitious price targets, Skoda will need to build the EV locally in India. However, the company's biggest challenge is battery prices, which have the most significant impact on the cost of an electric vehicle. Skoda's priority is to make an EV that is both affordable and profitable.

"Localization is one thing, but the most important issue is actually the battery price, the battery cell, and the battery package," said Skoda's Klaus Jahn. "That is the fact that influences the price of the EV the most. There are not too many good entry-level BEVs around the world that make money, because if they are cheap, they are usually not a big money-maker, which is also not sustainable in the long-term. We would like to have a solution that is affordable but also has profit potential."

Jahn added that Skoda will inevitably export locally-made EVs from India to other countries, including Vietnam, in the future.

Mahindra is already in course to source key components of the MEB architecture, inclusive of the electric powertrain, battery systems, and cells, from the Volkswagen Group. The Volkswagen Group is also conscious of Mahindra's desire to produce battery cells locally, and Mahindra has applied for the Advanced Chemistry Cell Production-Linked Incentive (ACC PLI) scheme in 2022, which could benefit both companies.

Outside of India, the Volkswagen Group has a derivative of its MEB Entry platform called MEB21F (the last character denotes front-wheel drive), which it plans to use for affordable EVs. Sources say that the platform has clear structural similarities to the MQB A0 architecture, a modified version of which underpins the India-made Kushaq and Slavia. The MEB21F platform is also likely to form the basis for an upcoming subcompact SUV from Mahindra.

Skoda's affordable EV is expected to be built on Volkswagen Group's MEB21F platform. This platform is said to be cheaper to produce because it uses shorter wiring harnesses and more effective cooling loops. It can also accommodate batteries of over 50 kWh in capacity, with more affordable versions using lithium-ferro-phosphate (LFP) chemistry cells and longer-range versions using more energy-dense nickel-manganese-cobalt (NMC) cells.

Skoda's affordable EV is still two to three years away from being launched, but it is almost certain that Volkswagen will release a mechanically identical twin model soon after. By then, the current market leader in EVs, Tata Motors, will have nearly 10 battery-powered offerings in its portfolio, and leading carmaker Maruti Suzuki will also have entered the EV market. Skoda should fast-track the development of more electric models to gain a significant market share in the coming years.