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Business Standard

EV plans face 24-month delay as OEMs, suppliers hit R&D, execution limits

Around 88 per cent of India's auto component suppliers are facing severe research and development capacity constraints, and electric vehicle (EV) programmes at legacy original equipment manufacturers (OEMs) are being delayed by up to 24 months, according to a new study by Vector Consulting Group. Long and uncertain wait times for customers, poor after-sales services, and frequent product recalls are the major concerns that the EV industry is currently facing, which is resulting in the delay. The study, based on conversations with over 100 chief experience officers across OEMs and Tier-1 suppliers, finds that the sector's biggest challenge is not a lack of vision or technology, but a widespread execution breakdown across the value chain. Automakers, suppliers, and EV start-ups are discovering that traditional models of new product development, supplier engagement, and supply chain management are no longer fit for purpose. 'The bottleneck is internal: poor coordination, capacity mismatches, and execution blind spots,' said Ravindra Patki, Managing Partner at Vector Consulting Group. 'To thrive in this new era, the industry must rethink how it works—not just what it builds.' Many OEMs are attempting to manage EV and internal combustion engine (ICE) programmes in parallel, without realigning or expanding internal capacity. Engineering, procurement, and validation teams remain shared across programmes, leading to rework, bottlenecks, and chronic delays. Even where dedicated EV teams exist, they often depend on legacy internal systems, reducing their ability to move quickly. Tier-1 suppliers face similar pressure. They are expected to support multiple complex programmes across multiple OEMs at once, often with limited visibility into volume forecasts or product timelines. As a result, suppliers are forced to deal with late-stage design changes, increasing risk, cost, and strain on an already stretched engineering bandwidth. 'If OEMs want reliable delivery, they must involve suppliers early, align them on product priorities, and integrate them into the decision-making process—not just the sourcing cycle,' added Patki. Start-ups, though free from ICE legacies, are not immune to execution challenges. Many over-promise on launch timelines and rely on digital workarounds—such as over-the-air (OTA) updates—to fix post-launch engineering issues. While agile in theory, this approach often leads to short-term fixes that hurt long-term brand trust and increase costs, the study notes. For a solution, the report recommends a fundamental reset in OEM-supplier collaboration. Vector calls for stakeholders to move beyond transactional, cost-down relationships to co-development partnerships. This involves shared risks, earlier design engagement, and common execution targets. It also includes setting up integrated OEM-supplier programme teams and using real-time product-maturity dashboards to reduce friction and delays. 'The winners of the next decade won't be those with the flashiest prototypes, but those who can launch, scale, and improve faster than others,' said Patki. 'That's why the industry must stop patching old systems and start building new ones.'