Indian automakers are ramping up efforts to transform their workforce with top-level reshuffles and retirement incentives for older employees, as more consumers warm up to the idea of electric vehicles.
“The demand for alternate fuels and electric vehicles is growing, resulting in a similar trend with respect to demand for skills in electric and electronics,” Ravindra Kumar GP, chief human resource officer at Tata Motors Ltd., told BQ Prime. “Availability of experienced talent is limited.”
Organisational change could be the next challenge for automakers as they upgrade their workforce with skills needed to manufacture battery-powered vehicles.
According to the Federation of Automobile Dealers Associations, sales of electric passenger vehicles increased 153% to 47,102 units in fiscal 2023. The penetration doubled to 1.3%.
“The demand for alternate fuels and electric vehicles is growing, resulting in a similar trend with respect to demand for skills in electric and electronics,” Ravindra Kumar GP, chief human resource officer at Tata Motors Ltd., told BQ Prime. “Availability of experienced talent is limited.”
Organisational change could be the next challenge for automakers as they upgrade their workforce with skills needed to manufacture battery-powered vehicles.
According to the Federation of Automobile Dealers Associations, sales of electric passenger vehicles increased 153% to 47,102 units in fiscal 2023. The penetration doubled to 1.3%.
Tata Motors, the leading electric passenger vehicle maker in India, is hiring talent across various functions, including engineering, electric & electronics, product development, sales and marketing, operations and supply chain to strengthen its workforce for EV operations. Apart from lateral hiring, the company is also upskilling its existing employees, Kumar said.
Compared to its rivals who have taken a more cautious approach to electric vehicles citing slower adoption, Tata Motors has been more bullish in its approach.
Electrified Workforce
The trend towards vehicle electrification is expected to generate demand for labour in three main areas, Krishna Kumar Agarwal, vice president at Quess IT Staffing, told BQ Prime, "the design and development of electric vehicle models, battery production, and charging infrastructure installation and maintenance."
TeamLease Services, a hiring firm, reported that in fiscal 2023, the EV sector witnessed almost 40-45% expansion in jobs, with approximately 60-70% of the jobs requiring new-age skills.
According to Quess Corp, with the projected growth in EV vehicles, it is expected that the overall workforce in the EV industry will account for around 25-30% of the total industry workforce.
However, there is greater consensus among two-wheeler makers regarding the imminent EV disruption, and they are likely to move faster in adapting to these organisational changes to stay competitive.
Electric two-wheeler sales increased nearly threefold to 7,30,000 units in fiscal year 2023, raising the penetration of electric models from 1.9% to 4.5%, data from FADA showed.
Earlier this month, Hero MotoCorp Ltd., India’s largest two-wheeler maker by volumes, announced a voluntary retirement scheme as a move to make the company ‘future ready.’
While the company did not respond to email queries, industry experts believe the decision is partly due to the emergence of EVs, which require 30-35% fewer parts than internal combustion-powered vehicles and may make many employees redundant.
Munira Loliwala, business head at TeamLease Digital, said that the existence of several traditional roles is diminishing as they are either non-transferable or re-skillable, leading to early exits and change of careers.
Although certain roles are slowly losing favour, new ones are emerging as companies invest heavily in digital transformation and automation. This has resulted in an increased demand for employees skilled in areas such as artificial intelligence, machine learning, data analytics, and cybersecurity.
Companies that fail to attract and retain talent with these skills risk falling behind in today’s highly competitive business environment, Loliwala said.
Bridging The Gap
The auto industry faces a significant challenge as it transitions towards electric vehicles due to a shortage of skilled workers. According to Agarwal at Quess Corp, the industry is struggling to find skilled engineers, particularly in software, battery management systems, and electrification.
The problem stems from universities, said Agarwal. “Universities that were once a reliable talent pipeline for the auto industry are still too focused on gas engines and transmissions,” he said.
To address this concern, there are increasing calls for investing in training and upskilling programmes from all corners of the industry.
However, not everyone is worried about the shortage. Those who possess the necessary skills are benefiting from the imbalance in supply and demand, as it provides them with better job opportunities and higher pay.
The automotive sector is experiencing a transition of workforce from different industries thanks to the higher salaries offered in new-age roles related to electric vehicles. These roles pay almost 30-40% more than traditional roles, which earlier were restricted to hiring from competitor companies only, according to Loliwala.
Ola Electric Technologies Pvt. Ltd., the company that sold the highest number of electric two-wheelers in fiscal 2023, is investing heavily in training and upskilling its workforce, which consists entirely of women.
It has upskilled its 3000-strong workforce “with on-the-job training,” enabling them to “undertake manufacturing process of all critical components,” the company said. From battery and motors to painting, welding, assembly, and testing, the all-women workforce run the entire production cycle and the company expects this workforce to increase to 10,000 at full capacity.
According to Ola, to make India the world’s EV manufacturing hub, the country needs to “prioritise skill development and training of the workforce to undertake this paradigm shift in mobility.”
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