- Sales of high-speed electric two-wheeler in June 2023 fell by 55% to 45,734 units.
- The government has reduced the demand incentive for electric two-wheelers and scaled down the incentive cap.
Electric two-wheeler sales fell by over 55% in June 2023 after original equipment manufacturers (OEMs) in India increased prices by an average of 21% following the FAME-II subsidy (Faster Adoption of Manufacturing of Electric Vehicles in India) revision.
A JMK Research and Analytics report compared the prices of different EV OEMs. The report stated that the price hike significantly impacted the sales figures in June 2023 for most electric two-wheeler brands in India. Sales of high-speed electric two-wheeler in June 2023 amounted to 45,734 units, representing a month-on-month decline of over 55%.
The government has reduced the subsidy provided under the FAME-II scheme applicable to electric two-wheelers registered on or after June 1, 2023, to 15% of the ex-factory price of vehicles from 40%.
Ola Electric’s S1 and S1 Pro models became 15% and 13% more expensive, respectively, resulting in a 38% decline in sales compared to May 2023. TVS iQube saw a 62% decrease in sales due to a 26% price hike.
Bajaj Auto’s Chetak experienced a sales decline of 73% with an 18% price increase. Ampere EV raised prices by INR 21,000 to INR 39,100, with Primus and Magnus’s models seeing the highest increase of 33% and 36%, respectively.
Hop Electric, an EV start-up, increased prices by 30% for their electric scooters. Hero Electric and Okinawa Autotech did not raise prices for their e-scooter models, while Okinawa Autotech had previously increased prices in December 2022.
The recent subsidy revision’s impact on sales could be a precursor to what may happen in FY2025, especially considering the end of FAME subsidies by March 2024. The reaction of consumers and the impact on the earnings of EV OEMs will be clearer in the coming months.
FAME-II is the second phase of the Indian government’s scheme that provides financial incentives to promote EV adoption in the country.