- The Ministry of heavy industries announced a reduction in FAME II subsidy for electric two-wheelers to ₹10,000 per kWh from ₹15,000.
- The cap on incentives will be brought down to 15% of the ex-factory price of vehicles from 40%.
Electric vehicles (EVs) in India will soon witness a price hike after the centre decided to cut the FAME-II (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles in India) subsidy on electric two-wheelers registered on or after June 1, 2023. The prices of EVs are expected to rise anywhere between ₹25,000 to ₹30,000 from June.
The inflated prices come after the Ministry of heavy industries announced a reduction in FAME II subsidy for electric two-wheelers to ₹10,000 per kWh from ₹15,000. The cap on incentives for electric two-wheelers will be brought down to 15% of the ex-factory price of vehicles from 40% at present.
The Economic Times reported that the total fund allocation for electric two-wheelers under phase II of FAME India will top up to ₹3,500 crores using the ₹1,000 crore allocation for electric three-wheelers.
The FAME-II subsidy scheme was started on April 1, 2019, for a period of three years, and was further extended for a period of two years up to March 31, 2024, with a total outlay of ₹10,000 crores to provide incentives to end users of EVs to enable wider adoption
Ather CEO Tarun Mehta tweeted that the price of Ather bikes would go up by ₹32,500 post the subsidy cuts, making the on-road price of the Ather 450X Rs 1,60,415 in New Delhi. At present, the cost of Ather 450X (without performance software) comes to ₹171,879 (ex-showroom) but when combined with a FAME 2 subsidy of ₹55,000 and ₹18,300 State Subsidy (in New Delhi), the on-road price comes to around ₹130,415.