Volvo Group recently signed an MoU with Tata Motors to build an ecosystem for zero-emission trucking. In an interaction with TNIE, Kamal Bali, President & Managing Director (MD) of Volvo Group India, talks about how coordinated action across fuel supply, infrastructure, and cost of ownership will scale the heavy-vehicle (HDV) green transition in India. Excerpts:
Volvo and Tata Motors signed an MoU recently. What are the key joint targets set for the next 2–5 years, and how will this collaboration boost the green transition ecosystem in India for HD vehicles?
First of all, it is an important development that our two companies — significant players in the global commercial vehicle space — are coming together to help build an ecosystem for zero-emission trucking. That is the need of the hour. Many actors are involved in developing such an ecosystem. It’s not just about creating a vehicle that runs on clean fuel. Even if we build that vehicle, the ecosystem doesn’t get fully developed.
There are multiple other actors — producers of non-fossil fuels, fuel-dispensing stations, the supply chain, and of course the total cost of ownership (TCO) that must make business sense. The transport buyer, too, must find value in adopting these solutions.
So, while TCO is very important, many things need to come together. There have to be catalysts like us who take the lead — as part of the LeadIT initiative — and we believe this is a strong ambition to pursue.
The EV and green transition in HD vehicles are taking more time than expected because coordinated action is required. If every actor in the value chain reaches even 80% readiness, the overall success rate will still be only around 40%. So rather than focusing solely on targets, this is a collaborative journey.
India’s EV ecosystem is still evolving. What key policy moves and industry initiatives are needed now to accelerate green mobility adoption in the heavy-vehicle segment?
The government began with the demand side — improving TCO through incentives on clean and green vehicles. That was a good kick-start. But we now need a more holistic approach, including the supply side, to develop the broader ecosystem.
The government should play a larger role in ecosystem development rather than offering incentives only to customers. It must invest across the chain. For example, the hydrogen (H2-ICE trucks) pilots — involving truck manufacturers like us and hydrogen suppliers — where hydrogen corridors are being developed to test vehicles. These are the right steps: investments that build the ecosystem and ensure every piece of the puzzle is addressed. Otherwise, the model will not work.
With China challenging India’s EV incentives at the WTO, do you see this dispute affecting India’s green transition in the vehicle sector?
Not at all. Each country makes decisions based on its own circumstances. Every country has incentives to promote particular technologies. India will take decisions that are best for her.
Also, zero-emission trucking should remain technology-agnostic — be it battery-electric vehicles (BEVs), hydrogen internal combustion (H2-ICE), or fuel-cell electric vehicles (FCEVs). There can be multiple pathways to zero-emission freight. LCVs and MCVs may largely adopt BEVs, while HDVs may move more towards hydrogen fuel-based solutions and other non-fossil alternatives.
Where does Volvo place India in its global supply chain, and how will this evolve in the coming years?
India is a major and growing focus area for our Group. Our largest technology centre outside Gothenburg is in India. Our largest digital and IT centre outside Gothenburg is in India. Our largest accounting services centre outside Gothenburg is also in India. For services, India is already second only to our headquarters.
On the manufacturing side, we are building our fourth international manufacturing hub in India, with an investment of around ₹2,000 crore over the next three to four years. Additionally, more components will be sourced from India, creating strong value-chain development. India will be a critical part of Volvo Group’s global value chain in a very big way.