Blog posts of '2023' 'February'

Green transportation is an important part of our society's sustainability efforts. It is a way for us to reduce our environmental impact and make sure that we are not relying on fossil fuels for our transportation needs. Simply, it is the usage of ways in which we as daily commuters use as less gasoline and fossil fuel as possible to transport and move from one location to the other. Green transportation doesn’t only include electric vehicles, however. It also includes other forms of sustainable transport such as public transit, cycling, walking, and carpooling. All of these methods can help reduce emissions while providing affordable alternatives to traditional fuel operated vehicle ownership.
Being more invested into the auto industry, we can see that they have been making strides in green transportation with the introduction of electric vehicles and hybrid cars. After the launch of the full electricity operated four-wheeler by the late 90’s, the electric vehicle market took a tall spike in its curve of growth. These vehicles have the potential to reduce emissions and create a more sustainable environment.

REALITY CHECK!!
Acquired data shows that, in Nepal, while there were around 24,000 vehicles registered by the year 2001, over 780,000 vehicles (two-wheelers and four-wheelers) were registered by the year 2016.
“This shows that the number of vehicles has multiplied by 32 times every year since then.”

Imagine the rate in which these numbers have rapidly multiplied in recent years. An increase in automobiles and vehicles entering the country means not only an increase in CO2 emissions but also increased usage of hydrocarbon/dirty fuel consumption, leakage, and externalities, and mismanagement of e-wastes leading to air, water, soil and sound pollution. The CO2 emissions, leakages and externalities do not only contribute to rapid climate change but also to long-term environmental degradation reaping the multitude of health, psychosocial and economic benefits from a clean environment.

IMPORTANCE OF GREEN TRANSPORTATION!!!
“Green transportation is no longer just an option - it's a necessity in order to protect our environment, promote sustainability, and ensure a healthy future for generations to come.”

Green transportation is becoming increasingly important to the auto industry and society as a whole. It is a necessity in order to help reduce our carbon footprint and protect the environment. The usage of vehicles that are powered by renewable energy sources, such as electricity or fuel cell technology, or using more sustainable fuels like biodiesel or ethanol is promoted by the objectives of traveling green. It is essential that we reduce our reliance on traditional vehicles and instead opt for green transportation solutions.
Importance of Green Transportation; specifically an electric vehicle is now the burning topic of the industry. Electric cars are becoming increasingly popular as they reach a wider market globally. Below we have listed the most crucial points that makes an electric two-wheeler or four-wheeler superior to any other modes of transportation:
● They use electricity to power their motors, which generates zero emissions when compared with gasoline-powered cars or diesel-powered engines that produce large amounts of pollutants like carbon dioxide and nitrogen oxides when burned.
● Electric Vehicles are also quieter than standard engine models on fuel operated vehicles.
● Electric Vehicles can be recharged in many ways, with a standard outlet or retractable batteries.
● A fully-charged battery can last up to a day and a half of daily driving on average (much more energy efficient). By making green transportation a priority, we can make strides towards sustainability and protecting the environment for future generations. This is not only necessary to reduce the environmental impact of automobile emissions, but also to promote a healthier lifestyle.

WHERE DOES NEPAL LIE?
Nepal has seen a significant improvement in its electric vehicle (EV) market all thanks to the development and growing popularity of renewable energy usage and the gradual increase of electric charging stations all over Nepal. Since the launch of electric vehicles in the Nepali market, it has seen rigorous growth in its consumption and usage especially in the urban cities of Nepal.
“Nepal imported an estimated Rs. 292.77 billion worth petroleum products in 2021.”

The growing usage of electric vehicles could heavily help in reducing the large quantities of petroleum products that are being imported into Nepal used to fuel the fuel operated vehicles. There are many ways in which the government of Nepal has been helping to reform the means of transport and promote green transportation. Policies like the Sustainable Development Goals of Nepal 2017, Climate Change Policy 2019 and Fifteen Periodic Plan of the Government of Nepal have been consistently highlighting the transition from a high carbon economy to a green economy, which is a highly appreciative task. Additionally, the Kathmandu Sustainable Urban Transport Project initiated by the Government of Nepal is expected to provide a sustainable and efficient urban transport system for Kathmandu valley, favoring local economic growth, and addressing climate change and air pollution mitigation.
However, the yearly policies and plans, for example, Budget Speech of 2077, which plays a key role in the implementation of sustainable policies of the Government of Nepal has not accommodated these genuine benefits. The tax exemption of the recent budget policy has heavily levied enormous amounts of excise and custom duties on the import of these electric vehicles tagged as luxury items. The Government of Nepal is unfortunately moving away from their plan to have a clean and green transport system in Kathmandu by the year 2030, envisioned by ICIMOD.
Transportation systems consume about 20% to 25% of the world’s energy and accounts for high carbon dioxide emissions. Use of renewable energy sources help limit the emission of harmful CO2. The Government of Nepal should prioritize subsidizing firms that bring in green technology and use it to prompt green transportation. To actually achieve the tag of a green city, the government's support, the citizens mentality and the users adjustability must all align to make this endeavor possible.

The automobile industry is one of the most rapidly evolving industries in the world. From advancements in manufacturing and engineering to the emergence of new technologies, the automobile industry is constantly pushing its markets boundaries. The evolution of the automobile industry has been driven by a number of factors, including increased demand for more efficient and safer vehicles, advances in technology, and
changes in consumer preferences.
“As a result, manufacturers have had to continually innovate to stay ahead of the competition.”

Technological Advancements in a wide scale

In recent years, there has been an increasing focus on developing electric cars and autonomous driving technologies as well as other advancements that could revolutionize how we use our vehicles. With advancements in electric cars, self-driving cars, and augmented reality, the automobile industry is making leaps and bounds in terms of technological development. This technology is transforming the way we drive and interact with our vehicles. From self-driving cars to augmented reality displays, there are endless possibilities for what technology can bring to the automotive industry. In addition, there are also numerous opportunities for automakers to use this technology to improve safety, efficiency, and convenience for drivers, making it one of the most rapidly advancing industries in terms of technology.

Real-life examples of Disruptive Technologies

Taking real-life examples into account, Volvo has begun to explore the use of self-driving cars that would allow for carpooling, which would lead to a huge economical impact on car ownership. They are also exploring the use of augmented reality displays in cars. If a driver is not distracted by driving, they can shift their focus to the augmented reality display and make important personal safety decisions such as when to apply brakes or exit the vehicle; simply the auto drive technology in four wheelers. Car companies like Tesla are already working with self-driving cars that are also on autopilot technology whereby an autonomous monitor decides when, where and how fast it travels within all traffic laws. As a result of the impact that Tesla has had on the automobile industry, a lot of other car companies have been focusing on creating electric cars.

How large is this industry?

“The global automotive market is estimated at $2 trillion and growing rapidly.”

The global automobile industry is very lucrative. In 2017, the profit was estimated at just 3% of the global automotive market share. This means that 97% of automakers in the world are losing money on each car they sell but still it's worth it for them to continue their investment in research and development in newer and faster technologies. Since their competitors are also investing heavily and developing new innovations, this will allow them to remain competitive in this highly competitive industry.

Investments??

The automobile industry is undergoing rapid evolution, with huge investments being made in the technology that powers our vehicles. Investment in the automobile industry has been made by a number of corporations and governments. This investment has led to the advancement of autonomous driving, electric vehicles, and connected cars. Automakers are now investing in the research and development of these technologies in cars and motorcycles to stay competitive in the global market. The advancements of these technologies have created a need for more investment in the automobile industry. Automakers are investing heavily in research and development to stay ahead of their competition and develop new innovations that will make their vehicles more efficient, safe, and reliable. This investment will ensure that automakers remain competitive as they strive to create better products for their customers.

Most recent automobile technologies

The most unique and evolving technologies that are slowly being used in many automobile manufacturers of four-wheelers as well as two-wheelers include:

a. Artificial Intelligence entertaining the concept of auto-pilot drive modes

b. 3D printing used in vehicle prototyping and manufacturing

c. Big Data Analytics to make the vehicle SMART

d. Virtual assistance and interactive vehicles

e. Inbuilt GPS (Global Positioning System) in the vehicles

f. Connectivity making the vehicle a big mobile device

These are a list of the most heard of and popular innovations that are applied to the
functions of a vehicle. There are so many more disruptive technologies of the
automobile industry that will change the stances of the traditional automobile industry
and will go beyond just solving the need of mobility and transportation.

Technology in the Nepalese auto industry

The Nepalese auto industry is heavily dominated by the distributors and dealers of the foreign automobile products. Nepal majorly has just seen the import of disruptive technologies in the automobile sector rather than manufacturing it. But in recent years, there has been a breakthrough in the two-wheeler industry of Nepal. YATRI; the electric bike manufacturer has become the first ever electric two-wheeler (bike) to be manufactured in Nepal. This was the Nepali Automobile Industry’s entrance to the world of innovations and technological advancement. They did borrow the concept of an electric bike from the already existing electric two-wheelers from all over the globe, but it is commendable that YATRI bikes could reach such heights of success and popularity. Here, We can deduce the role of technology in the automobile industry by evaluating how technology has influenced the manufacturers of YATRI bikes to make the first ever NEPAL MADE ELECTRIC BIKE.

Thus, Technology is important for efficiency and safety. Automobiles are one of the most complex products, so they require a lot of technology to make them. Things like radar and GPS have helped to make the cars safer and more efficient than they would be without these technologies. The automobile industry has an interesting relationship with technology because they are always trying to figure out how to incorporate it without making it too complicated for the average consumer. Technology is important for the automobile industry because it is an integral part of their business.

With the ever unstable government and their fluctuating policies with regards to the basic amenities for the citizens, we have not seen a constant phenomenon that governs fair and justifiable tax rates and policies. This is a rather sensitive topic to have a debate on but one can pour their views right??
The Government of Nepal has been making special changes and amendments on the policies that govern how the major industries of the nation operate in order to benefit all parties involved. The automotive industry; especially the vehicle importing industry of Nepal, is rather large. It is estimated that the vehicle import industry and businesses amount to almost 30% of Nepal government’s revenue in the form of excise duty, custom duty and vehicle taxes. Recognizing the above stated fact, we can make a vague connection between the Nepal Government, the auto industry of Nepal and the government policies impacts on the following. Vehicle Import in Nepal
Import Vehicles consist of various two-wheelers and four-wheelers that are imported to Nepal. These automobiles enter Nepal through various countries all around the globe through official and authorized dealers and importers. There are over 19,000 passenger vehicles that are sold to the buyers every year in Nepal. From which almost every vehicle is imported to Nepal.

“The Vehicle Import in Nepal is an estimated 17 Billion Rupees industry.”

It may only amount to a percent of all imports that are made in the nation, but it is one of the most crucial industries that binds the automobile dealers, the Nepalese buyers and the Nepal government together.

The vehicle importing businesses had seen their worst days and are still facing controversies and disagreements with the new fiscal budget as well as the new policies for the import duties. The April 2022 import ban on the 10 luxury tagged goods had temporarily made the import activities of vehicles like cars, jeeps and two-wheelers above 250cc created a chaotic market scenario. The market was stunned to witness this sudden policy application that left many
business owners, specially the vehicle dealers out of business.

In an interview with the President of NADA Automobile Association of Nepal; Mr. Dhruba Bahadur Thapa, he stated how the government's unstable policies have impacted the import industry. Initially, the 50 percent down payment requirement was a problematic policy for the automobile sector. After that, the central bank introduced a policy requiring 100 percent cash margin in the imports of vehicles. Then, the central bank restricted banks from opening letters of credit for the import of cars. Later, the government decided to ban the imports of vehicles citing them as “luxury goods” as per the April 2022 Import-Ban. The government blames depleting foreign currency reserves for the ban. It is concerning that the government targeted the automobile industry from facing the impacts of the depleting foreign currency reserve. This has made families think of buying a mobility vehicle as the second largest investment that they have to make after a housing facility.
Automobile Policy 2023. Is it still not just?

“The Automobile dealers are still not satisfied after the Import-ban was lifted. The policies are still not in their favor.”

The 8 months long import-ban was finally lifted in December 2022, with many parties at loss and protests faced. The Import-ban lift is unfortunately not enough for the dealers. There was a reigning impact on the dealers image in the international market. Because the dealers were barred from importing any vehicles from the manufacturers, the 1-2 month procedure of acquiring the letter of credit and the delivery was delayed and not accepted after the Nepalese dealers were out of the market for the 8 month ban period. This has made the current imports difficult for the dealers and the demand for these “luxury” tagged vehicles is not fulfilled.

The government of Nepal, according to the officials at NADA, wrongly chose the automotive industry of Nepal as a reason for lower foreign currency reserve, which also led to reduced revenues in the 8 month import-ban period. Even after this scenario, the Vehicle Tax rates remain unchanged. The imported raw materials and parts for automobiles are subject to a whopping 25% custom duty. The four-wheeler excise duty ranges from 75% to 105%, which is still progressively increasing. The two-wheelers are subject to excise duty ranging from 40% to 100%, which is also expected to remain unstable. The revised Vehicle Tax rates for the year of 2078/79 has not seen much improvement that would be beneficial to the dealers and the buyers. The government is further implementing restrictive policies against the automotive industry which has led to fewer and fewer vehicles in the showroom.

Electric Vehicle Tax in Nepal
The other most debated and talked about segment of the automotive industry is the electric vehicle industry in Nepal. The most outrageous amount and rates of custom duty and excise duty are levied on the more environment friendly options to mobility. The entire globe is progressing towards the modes of green transport and ethical mobility. Unfortunately, the moves taken by Nepal Government in the context of Electric Vehicles seem to be rather discouraging for the conscious buyers.
The budget presented by the Finance Minister; Janardan Sharma slapped 30 percent excise duty on vehicles fitted with 100-200 kW motors. A 45 percent excise duty has been levied on the import of EV’s equipped with motors of 201-300 kW capacity and a 60 percent excise duty has been slapped on EV’s with a motor capacity of more than 300 kW. Consequently, EV prices have always been at the peak and consumers have positioned the Electric Vehicles as “actual luxury” items. As an example to how the prices of EV’s have increased now:

“The Hyundai Ioniq-5, once priced at Rs 8.2 million, has increased to Rs 10.6 million.”

This has directly impacted sales. Despite a rise in inquiries for EVs among its popularity in the market, sales conversion is very low. This is due to lack of loanable funds with banks in the current scenario.

“The EV tax policies and rates have changed 4 times in this fiscal year.”

This simply shows how the government is unsure on either making the electric vehicle industry an easily accessible industry or a luxury tagged business that will not portray the true potential of Electric vehicles. This puts the future of electric vehicles in Nepal at stake. We as consumers cannot expect a steady change. We cannot imagine if Nepal will ever become a green nation.

Will green transportation replace the automotive industry? Will the policies support the transition? Or Will this even happen?

In the US alone there are over 1.7 million registered ride sharing drivers that work actively. In Nepal, there are an estimated over 100,000 ride sharing drivers, specifically the two-wheeler drivers who are actively providing this service.

Rise of Ride sharing
The culture of ride-hailing or ride-sharing surfaced in the valley in early 2017, when Tootle Nepal first made its appearance as the first ever home-grown ride-sharing application. Sixit Bhatta, the co-founder and CEO of Tootle Nepal took heavy inspiration from the prevailing western ride sharing technologies namely Uber and Lyft, from the United States. Since then a wave of new and alternative ride sharing applications has organically as well as rapidly grown into the valley as well as some major cities of Nepal.
Ride Sharing in Nepal started as the two-wheeler service that was more viable for the rough terrain and thin alley ways of the core value. Also to save more time in the in-city traffic, people majorly opted for the fast and swift mode of two-wheelers as their preference for ride sharing vehicle option. Hopping on to this sector of the service industry, this decade has seen major ride sharing service like Pathao Nepal; the Bangladeshi company that has prevailed the market, Sarathi, inDriver, Sajilo, Sahara and other major ride sharing services that are active in the Kathmandu Valley.
“Pathao Nepal alone has trained over 100,000 riders for the service they relentlessly provide.”

This shows how the way of urban public transportation is completely going a service driven route. These established and growing ride-sharing service providers have completely changed the urban young population commute through their daily travel requirements. Now-a-days, the adult and elderly population too have become familiar with the concept of ride-sharing and how it is better and more convenient than the crowded and lengthy public transport rides.

Where does it stand today?

With the growth in the usage of smartphones, most individuals in the urban and suburban cities have access to smartphones, internet facilities and the mobile data facilities. This has further accelerated the popularity of ride sharing services due to its convenience, speed and comfort of being able to have a customized ride for one. According to the NepaliWheels team's judgment, ride sharing services reign the public transport and commuting options especially in the valley and the major cities of Nepal.

Rather than waiting for a public vehicle at the bus stations, getting in with the crowd and fighting for seats and struggling for the most basic need to transport and commute, the ride sharing services have been able to solve all the mentioned issues for a bystander. With the most convenient user interface and usage ability, people with minimal experience in technology can swiftly map the different applications interfaces. Also due to its 24/7 availability, people started to prefer these ride sharing services as not trusted and believed them even more as they would be using it at the most inconvenient hours of the night.
“After the Covid-19 pandemic, ride sharing applications saw a BOOM in their business.”

The Pandemic made people avoid major crowds, especially in the crowded and congested public transport vehicles. The ride sharing services in both two-wheeler and four-wheeler taxi services provided a more secure, individual, safer and customized ride for the conscious commuters. The mode of transport was slowly inclining towards these single rider and customer ride sharing services that fulfilled all the safety protocols for the Pandemic in Nepal.

Legal Constraints
The ride-hailing service providers have faced a plethora of legal hurdles and challenges. From getting their operations temporarily closed by the Department of Transport Management, Government of Nepal, harassment allegations and cases around the company, the Nepal Meter Taxi Entrepreneur’s Association (NMTEA); an umbrella organization under the registered taxi operators, taking actions against the ride sharing services run by private two-wheeler or four-wheeler owners and so much more. Companies like Pathao Nepal, Tootle Nepal and inDriver Nepal have faced the most legal constraints that were more visible in the public eye.

The entire concept of ride sharing services operates on the laws that directly goes against the existing Motor Vehicles and Transportation Management Act-1993 prohibits the use of private vehicles to carry passengers on fares; the entire concept of all the ride-hailing services that operate globally. This created a major feud against the home-grown as well as global ride sharing companies to halt their services. The services were actually halted in early 2019, due to its inability to perform according to the Nepal government's reigning law. As there is a growing need for more convenient commuting options, the country desperately needs to make a separate act to manage and regulate new forms of urban transportation; the ride sharing services.

There have been instances where unauthorized riders have claimed to be the registered ride sharing drivers and have assaulted, looted, and vandalized the customer when they were on a recorded trip. This issue has recently surfaced about many ride sharing services that has made these companies take actions and make major changes to their company policies that were in benefit of not just the company but the rider as well as the customer. Pathao Nepal and Tootle Nepal requires its riders and delivery personnels to wear jackets with company logo on them and put up company logo stickers either on their vehicles or helmets. The Pathao Insured step taken by Pathao Nepal is commendable as the company takes responsibility for the rider as well as the customers safety.
THE FUTURE!!

“There are over 15 ride sharing services actively operating all over Nepal.”

And it is still expanding. Not just in the valley, ride sharing services have seen opportunities in major cities like Pokhara, Biratnagar, Itahari, Dharan, Chitwan and other major cities of Nepal. Companies like Pathao Nepal, Lozoom, Super App, Eddy cab have slowly expanded to the major busy cities of Nepal. Ride sharing in Pokhara has seen some popularity through Pathao Nepal and Pathao Food that is showing its presence in the city. NepaliWheels feels the future is bright!!

Ride sharing applications and services have been introduced to many new ventures as well. A sector that ride-hailing services of Nepal had never thought of exploring was the food delivery as well as actual product delivery services; in a surficial and minute level. For example, Pathao Nepal has expanded its services to Pathao Food and sometimes Pathao Nepal is used as a trusted delivery platform for different goods when in an emergency scenario. With this discovery, we can expect the other ride sharing services to hop on to these potential markets or even introduce newer markets to the sector.

There lies a rapid growth prospect for ride sharing services in major cities as public transport is viewed as a tedious task to complete and fewer people want to travel through the traffic congested roads in Nepal. With proper regulations and improved laws applied and drafted by the Department of Transport Management, Government of Nepal, the ride-hailing services can be operated in a lawful manner that would not disturb the existing transport services and a peaceful and fair environment for all can be created.