Policy push making EVS more affordable, say manufacturers

Along with record high fuel prices, this is helping change fence-sitters’ views, they say

Incentive schemes announced by state governments and the Centre have made electric vehicles (EVS), particularly twowheelers, very affordable and will lead to their faster adoption, said officials of various EV makers.

On Tuesday, Maharashtra joined Gujarat, Karnataka, and Delhi, among others, in announcing a comprehensive policy aimed at propelling the growth of battery-powered vehicles.

Manufacturers say such schemes have helped reduced EV prices by ~25,000-30,000 in some states. With petrol prices breaching the ~100 per litre mark in many cities and multiple product being offered in the EV space, buyers have started questioning the rationale behind opting for an internal combustion engine (ICE) powered twowheeler, said Sohinder Gill, director general of the Society of Manufacturers of Electric Vehicles (SMEV).

“Word of mouth is spreading fast,” Gill said. “We are seeing so much traffic in showrooms of people who are comparing EVS with ICE,” he said.

In June, India sold 25,000 e-two wheelers. This is equivalent to the March volumes, said Gill, adding that the recovery from the second wave of Covid-19 is firmly underway.

But the road ahead is long. India sold 152,000 electric two-wheelers in 2019-20, up from 126,000 in FY19. This trajectory was hit in FY21 by the pandemic, and it declined 6 per cent yearon-year, according to SMEV.

Joining the fray

However, manufacturers see hope in the possibility of other states announcing EV policies, like Haryana and Uttar Pradesh. “The state-specific policy is an additional sweetener over and above the FAME II policy,” said Gill.

And this policy thrust is helping, manufacturers say. “What we see on the ground is an exponential increase in consumer demand. The rise may also be driven by the pent-up demand from the second lockdown, but I would attribute it to the policies that were taken by the governments. Footfall in the shops definitely went up by 1.5-2 times, showing a definite upsurge in markets that have normalised,” said Nilay Chandra, director – marketing and charging infrastructure, at electric scooter-maker Ather Energy. The Bengaluru-based firm is backed by Hero Motocorp and Flipkart founders Sachin and Binny Bansal.

“The shoot up in demand for EVS is very clear,” said Shailesh Chandra, president, passenger vehicle business unit, Tata Motors, alluding to the demand for e-nexon.

Auto firms are lauding Maharashtra’s policy. Rajesh Jejurikar, executive director, auto and farm sectors, at Mahindra & Mahindra, said the new “Maharashtra EV policy is both, progressive and comprehensive in nature.” It covers all aspects of EV ecosystem from charging to making financing simpler.

“The policy rollouts by various state governments are helping in removing the bottlenecks in adoption of electrification.” It addresses all issues — from cost of acquisition, one of the biggest barriers in EV adoption, to focus on charging infrastructure and localisation in the state. “All these elements show that it’s a well thought policy and will help drive electrification,” said Chandra.

According to Ather’s Chandra the real impact of states’ policies will be felt in the festive season. A concerted policy push and rising petrol prices have changed “the attitude of a lot of fencesitters in the last one-and-a-half months,” he said.