EV Scooter E2W, Market Analysis

(Automobile Industry)

MICRO- ECONOMICS
ASSIGNMENT
Submitted By :
Sub-Rs one lakh e-scooters in demand as sales dip
for two-wheelers
Synopsis:
Retail e-two-wheeler sales
have been on an upswing and
accounted for 3.8% of the
total two-wheeler sales in
June 2022, up from 2.7% in
January. Okinawa leads the
pack, with sales at 47,121
units followed by Hero
Electric at 44,084 units.

(Article from Economics Times dated Jul 31,2022)

Oligopolistic competition: The EV sector in the automobile industry is a booming

sector. If we talk particularly of EV scooters in India, we see only a few key players
competing for market share.
 The initial and final equilibrium

Price Supply Price Final Supply

Curve Curve

P1

E1(P1, Q1)
E2(P2, Q2)
P2 P2

Final
Demand
Curve
Demand
Curve

Q1 Quantity Q2 Quantity
INITIAL EQUILIBRIUM
FINAL EQUILIBRIUM
(E1)
(E2)
The changing equilibrium of EV scooters in the automobile industry
 Shift :- Initial and Final Equilibrium
We are considering the EV scooter market of the automobile
Price Supply industry(particularly in the sub 1 lakh segment) :-
Curves

P1 -> Initially, We were in equilibrium (E1) when

this happened, but both the supply and
demand curves have since changed.
E1(P1, Q1)
E2(P2, Q2)
P2
P2 is around -> Main shifters of supply curve:
60-70k in the • Increase in number of Suppliers
market • The dotted line depicts government
engagement (programmes for EVs in some
states).
Demand
-> Main shifters of demand curve:
Curves
• Costs of associated goods: increase in the cost
of the replacement 2-wheeled vehicles (CAUSE:
Rise in prices of fuel which is complimentary for
Q1 Q2 Quantity the vhicle)
Increase in quantity
demanded from Q1
to Q2
 Analysis

Price Supply Explanations for change in demand for EV scooters

Curves

P1 SUBSTITUTION: EV Scooter are substitutes to the traditional 2 wheelers

E1(P1, Q1) • Rising operational costs (fuel prices) are what's causing the 2 wheeler
E2(P2, Q2) market to shift to the left, which is raising demand for EVs.
P2
PRICE: We are looking increase in demand for lower priced e scooter (sub
1 lakh)
• People are contemplating inexpensive EV scooters as more cheap
options due to rising fuel prices.
Demand
Curves OTHER FACTORS: Other elements that may be be having an impact on sales
include:

Government initiatives: Numerous state governments are taking steps toward EVs
Q1 Q2 Quantity that will benefit suppliers.

Increase in quantity in the Preferences: Some people are embracing sustainability and purchasing electric
automobiles as a result.
new equilibrium.
Expectations: Pre-orders for these scooters might grow if fuel prices
continue to rise.
 THANK YOU

Reference :
https://economictimes.indiatimes.com/industry/renewables/sub-rs-one-lakh-e-scooters-in-demand-as-sales-dip-for-two-wheelers/articleshow/
93243857.cms