The mobility sector in the emerging markets of South and Southeast Asia is experiencing an extraordinary surge, with the potential to attract as much as USD 1.3 trillion in green investment by 2030. This rapid growth echoes the impressive expansion of electric vehicle (EV) markets seen in China, as detailed in a recent report.
The report, titled Powering an Affordable EV Revolution in Emerging Asia, was unveiled just ahead of Climate Week NYC. It was jointly produced by investors LeapFrog Investments and Temasek, along with electric mobility companies Mahindra Last Mile Mobility Limited and Battery Smart. The findings underscore the emergence of accessible entry points for electric mobility, particularly in the low-income markets across the region.
Through a thorough analysis of the lifetime ownership costs associated with electric vehicles compared to their fossil-fuel counterparts, the report highlights a significant trend: electric scooters and three-wheelers have reached crucial price thresholds that have spurred increased demand for green mobility options, even among those purchasing vehicles for the first time.
Case studies conducted by Mahindra Last Mile Mobility Limited and Battery Smart further illustrate the rising capabilities of manufacturing and infrastructure dedicated to EVs within the region. The report points out that the anticipated demand for green capital in mobility—estimated at USD 1.3 trillion—significantly surpasses the combined capital needs of the energy sector (USD 400 billion) and the food sector (USD 350 billion).
In terms of environmental impact, mobility emissions account for approximately 10 percent of total greenhouse gas emissions in Asia. In contrast, these emissions represent 25 percent of Europe’s and 30 percent of the United States’. This highlights the urgent need for rapid electrification, especially as incomes in emerging Asian economies continue to rise.
Focusing specifically on India, the report notes that the annual ownership costs for electric scooters and three-wheelers are currently between USD 40 and USD 112 lower than those for petrol vehicles. Mahindra’s research indicates that around 70 percent of customers purchasing electric three-wheelers come from low-income backgrounds and are first-time vehicle owners.
The report also emphasizes the importance of a growing network of battery swapping stations, which, alongside interoperable battery systems among various vehicle manufacturers, has significantly enhanced the re-fueling infrastructure for electric vehicles. According to Battery Smart, the process of exchanging a battery at one of their 1,100 swapping stations across India takes less than two minutes.
Currently, electric vehicles account for an estimated 20 percent of the three-wheeler last-mile transportation sector in India, which includes both passenger and cargo services. Mahindra estimates that drivers using electric commercial vehicles can earn 20 percent more than those operating CNG or diesel vehicles due to the lower operating costs associated with electric three-wheelers.
The report also highlights the positive implications of improved mobility access, particularly for women. In countries like India, Bangladesh, and Vietnam, women are increasingly gaining autonomy by driving independently to their workplaces, reducing fuel expenses through electric scooter ownership, and thus enhancing their opportunities for equality.
Moreover, innovators and investors are actively tackling key barriers to the adoption of electric vehicles, including high upfront costs, range anxiety, and infrastructure limitations. Steve Howard, Vice Chairman of Sustainability at Temasek, noted that advancements in technology and business model innovations in the EV sector of emerging Asia, when supported by effective policies and substantial investments, present a significant opportunity for transformative impacts at both pace and scale.
Suman Mishra, Managing Director and CEO of Mahindra Last Mile Mobility Limited, emphasized the company’s commitment to electrification, stating, “As we continue our efforts in driving electrification, we also aim to enhance the lives of our customers—many of whom are micro-entrepreneurs—and support India’s mission towards lower carbon emissions by offering sustainable and economically viable solutions.”
Pulkit Khurana, Co-Founder and CEO of Battery Smart, remarked on the remarkable growth of the EV sector in South and Southeast Asia. He pointed out that the finding that 20 percent of all last-mile delivery fleets in India are now electric demonstrates a significant shift toward broader acceptance and adoption.
Finally, Souleymane Ba, Partner and Co-Head of Climate Investment Strategy at LeapFrog Investments, stated, “We have identified a USD 1.3 trillion opportunity for private markets and the impact investment community to revolutionize the future of global transportation.” This reflects the immense potential for growth and innovation in the electric mobility landscape of emerging Asia.
