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EV push to create more jobs despite disruption to traditional roles: Report

The report also says that Pune, India's auto hub, should take the lead in a smooth transition to electric vehicles for Maharashtra

electric vehicle

Anjali Singh Mumbai

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While the number of jobs per electric vehicle (EV) car is lower than the internal combustion engine (ICE) car, due to massive EV penetration in the coming years, there will be a net increase in the number of jobs. According to a new report by the International Forum for Environment, Sustainability, and Technology (iFOREST), it predicts a doubling of jobs in passenger car manufacturing alone, from 1.7 million in 2023-24 to 3.3 - 3.7 million in 2036-37.

The report also says that Pune, India's auto hub, should take the lead in a smooth transition to electric vehicles for Maharashtra. With its automotive legacy, Pune stands capable of driving change in the state's automobile sector. This shift will create new jobs in areas like battery technology but also displace some workers in traditional manufacturing.

The study sheds light on the intricacies of this transition highlighting that depending on the vehicle type, a significant portion (45-84 per cent) of parts from ICE vehicles, primarily powertrain components, will become outdated with the EV transition. This shift will undoubtedly impact manufacturers specializing in these components.

An analysis of over 1,100 auto component manufacturers (ACM) in Pune showed the implications for ACM revealing that approximately 25 per cent of them are expected to face moderate to high impacts due to transition in the EV landscape. Micro, small, and medium enterprises constituting 97 per cent of ACMs, emerge as particularly vulnerable given their limited resources and capacity for technology adoption.

A large number of contractual and informal workers (nearly 60 per cent of the workforce) in auto component companies, especially those in micro and small enterprises, will be vulnerable. About 31 per cent of existing job roles, primarily in manufacturing, will be affected, with 14 per cent becoming outdated and 17 per cent requiring reskilling. However, the overall job market is expected to see a net increase.

In the EV ecosystem, the number of job roles is estimated to be around 5 per cent higher compared to the ICE vehicle ecosystem. However, these jobs will demand a higher level of education and skills from workers. Over 340,000 workers are formally employed by automobile and auto component manufacturers in Maharashtra. Although the transition to electric vehicles (EVs) is expected to impact traditional manufacturing jobs in internal combustion engine (ICE) vehicles, the overall effect on employment is projected to be positive.

Six districts in Maharashtra - Pune, Nashik, Aurangabad, Mumbai (Suburban), Thane, and Kolhapur - are particularly vulnerable due to their high concentration of auto manufacturing units and workforce dependence on the sector. These districts account for 65 per cent of the state's auto units and 83 per cent of the formal workforce.

In light of these findings, the report proposes a comprehensive 'Just Transition Policy Framework for the Automobile Sector for Maharashtra.' This involves various policy aspects, such as innovations in clean mobility, fiscal policies supporting green manufacturing practices, and robust skilling initiatives aligned with the EV ecosystem.

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First Published: Apr 03 2024 | 9:10 PM IST

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