Launching EVs in India not a viable business case right now, says Mercedes

German carmaker Mercedes-Benz does not yet see a "viable business case" to launch electric vehicles in India due to lack of clear policy and incentives to sell such models in the country, a senior company official said on Thursday.

The luxury automaker, which Thursday introduced updated version of its C-Class sedan in the country, priced between Rs 4 million and Rs 4.8 million (ex-showroom), said that due to high import duties on completely built units (CBUs) pricing of electric vehicles (EVs) is highly uncompetitive as compared with vehicles with internal combustion engines.

"We are also considering to launch electric vehicles in India. But quite frankly an electric policy would help. A policy which would outline the long term perspective, framework and parameters under which we could sell," Mercedes-Benz India Vice President, Sales & Marketing, Michael Jopp said.

In the current scenario with no policy, no framework, no incentives and clearly higher cost, the company do not yet see a viable business case for EVs, he added.

Jopp said globally Mercedes is moving towards electric mobility.

"By 2022, we will have ten battery electric vehicles in our portfolio globally. We also expect that by 2025 the share of electric vehicles would be between 15-20 per cent," he said.

To make EVs viable in India, the company has been requesting the government to consider reducing the import duty on battery operated EVs so that they can compete with company's locally produced cars, he added.

"This will help accelerate market for EVs, which would also help in expansion of charging infrastructure...with the growth of the segment we could also investigate local manufacturing (for EVs).

"We would also be very happy if the government would also consider plug in hybrids because they would help in transition from combustion engines to battery electric vehicles," Jopp said.

The company's decision to bring in EVs will depend upon policy framework and it would not "launch for the sake of launching", he added.

"If we launch we would like to sell and...at this point we are observing and we will take decisions once time is ready," Jopp noted.

Currently, CBU cars, whose value is more than USD 40,000, attracts an import duty of 100 per cent.

The company, however, will also keep investing in internal combustion engines, Jopp said.

"We also see an ongoing relevance of combustion engines so that from our perspective for all markets, including India it is important to offer choices to customers. That is why we will keep investing in diesel engines because that is a clear preference (of customers)," he added.

The new C 220 D Prime is priced at Rs 4 million, C 220 D Progressive is tagged at Rs 4.4 million, while the C 300 D AMG line is priced at Rs 4.8 million.

Commenting on the launch, Jopp said: "Selling over 30,500 units since its inception in India, the C-Class has been one of the best-selling luxury sedans for the Indian market and remains a key contributor to our continued success in the market".

The company has already launched seven products in the first half of the current year and would introduce few more during the year, Jopp said.

"There will be new launches this year and continue our product offensive next year as well," he said, adding that the company aspires to retain leadership position in the luxury segment.

In the first half of the current year, the company has sold 8,061 units, a growth of 12.4 per cent over same period of last year.