Do the numbers add up?

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Do the numbers add up?

Friday, 12 July 2019 | Kushan Mitra

Do the numbers add up?

The Hyundai Kona Electric is the first long-range electric vehicle launched by a mass-market manufacturer in India. But does it make any sense?

Hyundai has ambitious electric vehicle plans for India and the first step in that vision is the Hyundai Kona, a Creta-sized Sports Utility Vehicle. When you first glance at it, it sure looks like an SUV that has been lightly grazed by the future. It looks quite normal and that is one message that car designers are trying to send to potential buyers. The future does not have to look very different, even though it might drive quite differently. Hyundai India had arranged a short three-lap run with the Kona around the Buddh International Circuit, more for logistical reasons than for performance reasons.

The track is not the natural home of the Kona, with its low rolling resistance tyres and the fact that it is a SUV makes it slightly skittish, although like in all electric cars with a decent battery, the acceleration is linear. While the Indian version of the car has a slightly smaller battery than the American and European variants, it can still do a decent rate of knots, and can do it reasonably quickly as well at just under ten seconds.

The interiors are pleasant, a bit more advanced than your regular Hyundai interior, with a full digital display replacing the instrument panel, buttons and the traditional gearbox. I have to note that in the other cars that I have driven with such button gears, reversing can be a bit of a pain if you need to nudge forward a couple of times. On the race track, where you are always driving forward though, this was not an issue.

But let us get to the crux of the matter when it comes to electric cars. The Kona costs Rs 25.3 lakh, and will come in a single specification. In addition, this is the price as of now when electric cars incur a GST rate of 12 per cent although a potential decline of the rate to five per cent has been proposed by the Finance Minister in her budget, which could bring down prices by up to 1.5 lakhs. On top of that, some states have been fairly progressive and removed road tax and registration fees for electric vehicles. So for the Kona, in Delhi and some other states, all you will pay will be the ex-showroom price plus insurance.

We will get to the matter of costs and whether the Kona makes sense from an economic point of view in a bit. But first, the issue of range and charging time. Hyundai India says that the Automotive Research Association of India has certified the car with a range of 452 kilometers from its 39.2 Kilowatt-Hour (KwH) battery and that has led to some questions. The ARAI does not currently have a standard to measure electric range properly in a combined cycle and comparing the Kona to other vehicles with a 40 KwH battery, a more reasonable range while using the air-conditioner and other creature comforts, would be under 300 km. The BMW i3s that I drove recently claimed battery usage at 12.9 KwH per 100 km, but the Kona is a bit bigger and heavier, so will likely consume a bit more. It is not always accurate to multiply a per-KwH economy into total range because electric vehicles do generate a significant amount of power from regenerative braking, and the Kona has three-levels of such braking. At the highest L3 level, you can really drive without the brakes if you want to, such is the braking action when you lift your foot off the throttle. Weirdly, in urban conditions with a lot of braking, an electric car could have a slightly greater range than constant speed highway driving with minimal regeneration. But the Kona should be able to get from Delhi to Chandigarh or Jaipur in one charge of electricity.

How long does the Kona take to charge? Well, if you use your regular wall socket, which you can use in a pinch, well it will take upwards of 16 hours to fully charge. Hyundai is proving the car with a wall socket that will use accelerated Alternating Current charging from your meter, and the car can be fully charged in six hours, so overnight. At the same time, there are some Direct Current fast charging station as well, Hyundai is establishing a few of these in collaboration with Indian Oil at major petrol pumps, the Indian Oil pump on Niti Marg, Chanakyapuri in Delhi being one of the first. This fast-charger will allow the Kona to get to 80 per cent full charge within 15 minutes. Given the price of the Kona, it is more than likely that buyers will have a proper parking slot for the car, so using the high-amperage wall box will be the standard way to charge it, and given a daily commute of 50 kilometers, a single charge should last a week quite easily.

But does the Kona make sense? It certainly makes sense if you are worried about air pollution, and even if sceptics point out that a majority of India’s power is generated from coal-fired plants, an electric motor is more efficient from a carbon perspective. It is, however, slightly less carbon-efficient than a plug-in hybrid in India at the current time. Also keep in mind, this is the current maths given India’s present energy-mix, which is changing with more wind and solar plants so going forward, the carbon impact of electric cars will much lower than it is today.

But from a money point of view? As said, the Kona is more or less the same size as the Hyundai Creta, which is an extremely popular car.  Therefore, to compare the Kona against the top-end petrol Automatic variant of the Creta, which costs just above Rs 16 lakhs, all-inclusive in Delhi. The Kona, with insurance, will cost just above Rs 26 lakh (unless GST rates go down), a ten lakh rupee difference. But electric cars are far cheaper to run, the BMW i3s delivered, in the city, a running cost of 96 paise a km. But can you make back the additional ten lakhs you spend on a Kona over the 160,000 km, eight-year  guaranteed life of the battery?

This is a bit tricky, because petrol prices are just shy of Rs 75/litre and India is just one Iranian conflagration away from Rs 100/litre petrol. But at current prices, taking petrol at Rs 75/litre and the Creta’s fuel economy at around 12 km a litre, reasonable in urban conditions, the fuel operating costs of the Creta are Rs 6.25 per km. The Kona, again using Delhi’s peak rate residential power charge of Rs 7.75 per unit (not amortising the fixed cost of the power connection here) and an economy of 14 units per hundred kilometers, the per km running cost is Rs 1.1, a difference Rs 5.15 per km, assuming all other costs are more or less the same after the battery’s warranty runs out. You would have saved Rs 8.24 lakh. Now, if fuel prices go up significantly and power prices remain more or less steady as they have for years, the maths can change but you just about there.

The problem is that after eight years, when the battery’s rated cycle-life of 2000 cycles is over you will need to replace it, and batteries are expensive, so what will your asset be worth then? You will get some money back for the battery, but on vehicles like the Kona, the battery is over two-thirds of the cost. That said, if fuel prices hit Rs 100/litre, and the GST on electric cars comes down to five per cent and your savings hit Rs 7/km, the numbers change positively for the electric car. One is also assuming that batteries will become cheaper with mass manufacturing by the likes of LH, Panasonic and Samsung and this will be coupled with more energy-dense batteries with potential future technologies like Lithium-Sulphur and Solid State batteries and who knows. As of today? I really do not know as yet, but I am willing to be persuaded.

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