A recent study by Tata Consultancy Services revealed growing consumer interest in EVs, yet cost concerns and sustainability debates continue to shape the industry’s trajectory. As manufacturers invest in electrification, how will they address these challenges?
Last month, a new study from Tata Consultancy Services (TCS) shed light on shifting consumer attitudes towards electric vehicles. The ‘TCS Future-Ready eMobility Study 2025’ found that nearly two-thirds of consumers—64%—were ‘likely’ or ‘very likely’ to consider an EV for their next vehicle. Yet while enthusiasm for electrification is clearly growing - albeit at an apparently sluggish rate - the survey simultaneously underscored lingering concerns, with 60% of respondents citing charging infrastructure as a significant barrier. Nevertheless, more than half of those surveyed (56%) indicated they were willing to spend up to $40,000 on an EV.
For context, the study, based on responses from over 1,300 participants across North America, Europe, and the Asia-Pacific region, covered a broad spectrum of stakeholders, including automotive manufacturers, charging infrastructure providers, fleet operators, and consumers.
Sustainability and lower operating costs emerged as the primary drivers of EV adoption, particularly for commercial fleets, with some 53% of fleet operators citing cost savings as a key motivation, and many willing to pay a premium for electric models over traditional internal combustion engine vehicles (ICE).
However, while environmental considerations featured prominently in consumer decision-making, the study revealed a more nuanced picture among industry influencers (made up of stakeholders like Policymakers, researchers, urban planners and advocacy groups). Nearly half (48%) of EV experts surveyed believed that the net carbon impact of EVs was more complex than often portrayed, suggesting that their benefits may be offset by factors such as battery production emissions, with a further 10% arguing that EV adoption was, in fact, detrimental to the environment.
”While nearly two-thirds of consumers are open to choosing electric for their next vehicle, manufacturers face challenges like advancing battery technology, complex vehicle designs, and production economics”
- Anupam Singhal, President of Manufacturing, TCS
TCS’ findings highlight the ongoing debate over the true sustainability of electric mobility and the broader challenges that manufacturers and policymakers must address.
At the time, Anupam Singhal, President of Manufacturing at TCS said, “The electric vehicle industry is at a defining crossroads, navigating the complexities of scale and transformation. While nearly two-thirds of consumers are open to choosing electric for their next vehicle, manufacturers face challenges like advancing battery technology, complex vehicle designs, and production economics.
“The electric vehicle industry is at a defining crossroad, navigating the complexities of scale and transformation. While nearly two-thirds of consumers are open to choosing electric for their next vehicle, manufacturers face challenges like advancing battery technology, complex vehicle designs, and production economics.”
Now, AMS interviews Singhal for a deeper dive into the challenges and opportunities around scaling EV production, including battery manufacturing innovations, nearshoring strategies, supply chain resilience, and the future of sustainable mobility.
Hi Anupam. Given the increasing demand for electric vehicles, how do you think battery manufacturing can scale effectively while maintaining cost efficiency and sustainability?
We consider this from two perspectives: demand and supply. The demand for electric vehicles is extremely high, driven by the growth of both hybrid and fully electric vehicles. Our recent e-mobility study, which surveyed 1,300 respondents, found that two out of every three consumers would opt for an EV, provided the price remains within approximately $40,000. However, concerns regarding charging infrastructure and battery range remain significant barriers to widespread adoption.
Battery manufacturers must address two primary factors: cost and energy density. The technological advancements in battery chemistry, design, and materials play a crucial role in extending battery life and improving efficiency. Regenerative braking, for example, is an area of focus.
In our collaboration with Jaguar Land Rover’s Formula E team, drivers receive only 50% of the charge required to complete a race, with the remaining energy being generated through regenerative braking. This principle, if extended to consumer EVs, could enhance battery efficiency and sustainability.
”Smart manufacturing strategies enable proactive maintenance, reducing unplanned stoppages. By controlling operational variables and improving efficiency, manufacturers can mitigate cost pressures while awaiting the next wave of battery innovations”
- Anupam Singhal, TCS
Significant investments are being made in battery manufacturing. The Tata Group, for instance, is investing £4 billion ($5 bn) in a gigafactory in the UK and establishing similar facilities in India. Other manufacturers, including Tesla, are making comparable investments. The investment will continue, and each company is looking beyond its internal production. For instance, Tata is not only producing batteries for its own EVs but also supplying them to the wider market. As manufacturing scales up and technology advances, battery costs will naturally decline, making EVs more accessible to consumers.
The study indicates that major battery technology breakthroughs are at least two years away. What strategies can manufacturers adopt to bridge this gap and maintain competitiveness?
Given that technological advancements are constrained by ongoing research and development, manufacturers must focus on optimising operational efficiency. This includes reducing waste, leveraging Industry 4.0 and 5.0 technologies, and ensuring a resilient supply chain.
Predictive analytics, sensorisation, and IoT integration can minimise downtime and optimise production processes. Smart manufacturing strategies enable proactive maintenance, reducing unplanned stoppages. By controlling operational variables and improving efficiency, manufacturers can mitigate cost pressures while awaiting the next wave of battery innovations.
Another key area is cost management within the supply chain and production processes. Manufacturers must look at ways to streamline operations, reduce material waste, and enhance automation to drive down costs. For instance, smarter supply chains, minimised shutdowns, and optimised distribution models will ensure that manufacturing remains viable during this transitional period before the next technological leap.
”Automation and AI-driven manufacturing are revolutionising cost structures”
- Anupam Singhal, TCS
How do you see nearshoring strategies playing a role in making EV battery manufacturing more competitive, particularly in North America and Europe?
Nearshoring can impact manufacturing competitiveness in multiple ways. Labour and material costs in specific regions may be lower, improving cost efficiency. In North America, initiatives promoting domestic production, such as the Inflation Reduction Act in the US, are driving investment in localised battery manufacturing.
Moreover, automation and AI-driven manufacturing are revolutionising cost structures. Technologies like generative AI and digital twins—such as the Nvidia Omniverse applications we are implementing—are streamlining production, reducing inefficiencies, and enhancing competitiveness.
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While nearshoring provides benefits, Western manufacturers also have opportunities to drive down costs through smart automation, digital transformation, and optimised logistics strategies. The ability to leverage economies of scale through automation and advanced AI can offset some of the cost benefits associated with nearshoring, allowing manufacturers to maintain competitiveness even in high-cost regions.
What would you say are the key challenges to scaling EV production, and what solutions does TCS see as critical to addressing them?
Supply chain resiliency remains the foremost challenge. EV manufacturers face the same logistical constraints affecting other industries, including supplier diversification and material availability. Innovations in alternative battery materials are also critical.
For example, we are working with a Norwegian partner exploring the potential of sawdust as a component in battery production.
Beyond supply chain and material innovation, digitalisation and automation play a vital role in cost reduction. Technologies such as Industry 4.0, IoT-enabled smart plants, and predictive maintenance improve efficiency and lower operational costs, enabling manufacturers to scale production more effectively.
Another key solution is diversifying sourcing strategies. Manufacturers are increasingly looking for alternative suppliers and materials to reduce dependency on single sources. Companies must also ensure they have a robust strategy for managing geopolitical risks, securing access to critical materials, and creating redundancy in their supply chains to mitigate disruptions.
What has TCS found are the key factors enabling EVs to achieve price parity with ICE vehicles?
Battery costs continue to decline, and we see companies actively working on cost-reduction strategies. For example, if Tesla is able to bring down the cost of its vehicle to $25,000, as they have discussed, it is evident that they are not planning to sell at significant losses. This implies substantial reductions in production costs, supply chain efficiencies, and technological advancements that are bringing down overall manufacturing expenses.
”Beyond batteries, we are also exploring alternative propulsion technologies such as hydrogen fuel cells. Research is ongoing into hydrogen’s viability as a sustainable energy source, though logistical and safety concerns must be addressed”
- Anupam Singhal, TCS
Manufacturers are focusing on reducing production costs through automation and optimised supply chains. The widespread adoption of AI in production processes, design for intelligence approaches, and smart factory initiatives are driving these cost reductions. Moreover, as economies of scale come into play, costs will naturally decrease further, making EVs more competitive in the market.
Another important factor is government incentives and regulatory support. In many regions, government policies are playing a critical role in offsetting the cost gap between EVs and ICE vehicles, ensuring that consumers find EVs a financially viable option.
And finally, Anupam, is there anything else you would like to add?
Beyond batteries, we are also exploring alternative propulsion technologies such as hydrogen fuel cells. Research is ongoing into hydrogen’s viability as a sustainable energy source, though logistical and safety concerns must be addressed.
Additionally, small modular reactors (SMRs) could play a role in decentralised energy solutions for EV charging. I was recently speaking with manufacturers about the feasibility of using SMRs to power EV charging stations or even vehicles themselves.
If small nuclear reactors could be developed to support automotive applications, we might see breakthroughs in range and energy efficiency that go beyond what is currently possible with batteries. The future of sustainable mobility will likely encompass multiple energy solutions beyond just batteries and electricity.
We need to keep our focus on a diversified energy ecosystem that ensures the best possible balance of cost, efficiency, and sustainability.
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