Here’s how the electric auto industry reacted to the revision of the FAME II policy.
Electric two-wheelers that comply with the FAME II subsidy program will see a big price reduction
Electric vehicle manufacturers have welcomed the central government’s amendment to the FAME II scheme for electric vehicles. The notification issued by the Department of Heavy Industry recently announced the increment of subsidy on electric two-wheelers from ₹ 10,000 per kWh to ₹ 15,000 per kWh.The amendment will bring a massive push in the adoption of electric two-wheelers as the delta between petrol offering and electric offerings will reduce further. Here’s how the industry reacted to the revision of the FAME II policy.
Also Read: Electric Two-Wheelers To Get More Affordable As Government Amends FAME II Subsidies
Tarun Mehta, CEO and Co-Founder, Ather Energy, said, “The revision in the FAME policy, increasing the subsidy by 50 per cent per KWh is a phenomenal move. Sales of electric two wheelers have grown despite the pandemic and with this additional subsidy, we expect electric two wheeler sales to disrupt the market, and clock 6 million+ units by 2025. Ather Energy already has plans to expand distribution to 30 cities in the next 6 months and this increased subsidy will help accelerate consumer demand, immensely. The Government’s continued support to drive adoption of EVs, with a keen focus on locally built electric two wheelers will make India the manufacturing hub of EVs.”
Jeetender Sharma, MD & Founder – Okinawa Autotech, said, “The E2W industry is once again experiencing a positive sentiment and a high level of interest from the Government of India. The government of India’s revisions to FAME-II subsidies is a welcome step that will only add zeal to the adoption of electric vehicles. Lowering the prices of electric scooters in the country will really help to persuade more riders to switch from a combustion-engined model to an electric one. We have always emphasized the importance of creating an ecosystem for EV mobility, and this new revision to the FAME II scheme is an important step in that direction.”
Sudarshan Venu, Joint Managing Director – TVS Motor Company said, “We welcome the government’s continued support to EVs. Sustainable mobility solutions are very important for the future and TVS is investing significantly behind this. The improved incentives for electric two wheelers will increase penetration. Such policy direction should lead to indigenous development of future technology.”
Rahul Sharma, Founder, Revolt Motors, said, “The recently announced modification in the FAME India Phase 2 scheme will prove to be a game changer. The increase in financial incentive will further help in boosting the adoption of products in the category and is a reinforcement of government’s commitment and intent for the EV industry. We are very pleased with this development as Revolt plans to reopen booking and further expand into newer markets. Such interventions coupled with the ongoing focus on infrastructure development can accelerate the growth of the sector immensely.”
Sohinder Gill, Director General – Society of Manufacturers of Electric Vehicles (SMEV), said, “It’s an important and admirable decision taken by the government, a move that will bring down the prices of electric two wheelers nearer to the IC vehicles and remove one of the biggest blockade of the high sticker price of electric two wheelers. A city speed electric scooter with a range of 100 km/charge will now cost less than ₹ 60,000 and a high-speed scooter with a range of 80 km will come nearer to the price tag of ₹ 1 lakh. Together with the other important factors like extremely low running cost, low maintenance and zero emission, such price levels will surely spur a substantial demand of electric two wheelers. We believe the time has come for mass adoption of electric two wheelers and such initiatives coupled with a mass awareness campaign by the government and easy terms financing by public sector banks will bring us closer to the target of 30 per cent of the two-wheeler market becoming electric in 5 years.
Commenting on the announcement, Uday Narang, Chairman – Omega Seiki Mobility said, “This revolutionary step by the government to subsidise electric three-wheelers, two-wheelers, passenger vehicles and buses will provide the much-needed impetus in faster adoption, thus helping greatly in building up the ecosystem of EV’s in India. We at Omega Seiki Mobility strongly support this initiative. It is a major incentive for Make-in-India local manufacturers like us, enabling us to bring more and more EVs of various segments to the country. This will notably make India a significant player in the EV Industry”
The notification also revealed that the government will procure electric three-wheelers for different applications via EESL. This is big news for players like Mahindra Electric and Euler Motors who have offerings in this space.
Speaking on the announcement, Saurav Kumar, Founder and CEO – Euler Motors, said, “The decision to extend the FAME II scheme will be incremental to push EV adoption in the country. The FAME subsidies have helped EV manufacturers to build efficient and advanced vehicles in the last three years. However, the strict stipulations of the scheme have limited the OEMs to avail of its benefits. Given the slow uptick of EVs, the relaxations and revisions in the scheme will ensure OEMs can continue to offer the vehicles at a subsidised cost and cultivate a larger market for electric vehicles.”
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