Zoomcar Navigates EV Hurdles, Regulatory Scrutiny Amid India's Mobility Shift

Nasdaq-listed Zoomcar, the self-drive car rental company, is navigating dual challenges of integrating electric vehicles into its fleet and navigating the country's complex regulatory landscape, chief executive Hiroshi Nishijima told NDTV Profit in an interview.

While Zoomcar doesn't prioritise tracking market share or focusing on competitors, Nishijima said that Zoomcar's India operations had become profit-neutral for the December quarter, covering all operational costs.

The company's push for EV adoption, driven by growing demand for sustainable transport, is being hampered by the country's embryonic charging infrastructure, Nishijima explained.

"While the enthusiasm for EVs is undeniable, the infrastructure simply isn't keeping pace," Nishijima told NDTV Profit. He acknowledged the difficulties, citing customer frustrations stemming from lengthy charging times and limited availability of charging stations, particularly in India's rural and semi-rural areas.

To put this into perspective, the total number of operational electric vehicles in India is likely to cross the 28 million mark by 2030, according to the India Energy Storage Alliance. Elon Musk's Tesla is also set to enter the Indian markets as it ramps up hirings and looks for land to set up a manufacturing hub.

Havells India Ltd. also recently told NDTV Profit that it will enter the electric vehicle charging market in the next six months as the company aims to tap into the lucrative sunrise sector.

"We're actively exploring solutions, including partnerships to expand charging networks, but it's a systemic issue that requires broader collaboration," Nishijima said.

He added that Zoomcar is exploring partnerships with EV fleet providers to offer electric vehicles for shorter, city-based use cases.

Adding to the company's challenges in India is the scrutiny of regulatory compliance. Kerala's transport minister recently said that the state plans to crack down on unauthorised 'rent-a-car' services, including those offered via platforms like Zoomcar. The minister alleged that many vehicle owners associated with the app were found to be complicit in legal violations, including flouting number plate regulations.

Acknowledging this, Nishijima said, "We are working closely with authorities to address their concerns and reinforce our commitment to operating within the legal framework."

When asked how Zoomcar is addressing the specific issue of cars not following legal regulations, Nishijima responded, "It's still in the discussion, but looking at the terms and conditions of what we have, we strongly follow the regulation."

Zoomcar is set to broaden its chauffeur-driven rental services, known as Zoomcar Cabs, beyond its current pilot in Bangalore. The chauffeur services will soon be launched in New Delhi, Mumbai, Hyderabad, Chennai, and subsequently in Pune and Kolkata, Nishijima said.

Regarding a potential Indian IPO, Nishijima stated that while Zoomcar explores all avenues to benefit the company and its shareholders, there are currently no concrete plans or announcements for a Dalal Street debut. The company's immediate priorities lie in solidifying its market position and enhancing its service offerings within the Indian landscape.