In fiscal year 22-23, India’s electric car sales surpassed one million units. According to the most recent figures from the Society of Manufacturers of Electric Vehicles (SMEV), the whole EV industry sold 1,152,021 units in FY 2023, including e-buses, e-cars, e-three-wheelers, and e-two-wheelers. This is a 58% increase over the 726,861 units sold in FY21-22.
The industry sold 726,976 high-speed e-two wheelers, accounting for 62% of the EV pie, while adoption declined month on month, “finishing with an annual shortfall of more than 25% above the minimal objective set by Niti Aayog,” according to a statement from SMEV.
Apart from that, the two-wheeler sales tally also comprised 120,000 low-speed e-scooters, 285,443 low-speed e-rickshaws, and roughly 50,000 low-speed e-cycles, totaling 846,976 units in FY23.
This is a significant increase from the 27,888 electric two-wheelers sold in FY17 and over three times the 328,000 units sold in FY22. In FY23, electric three-wheelers accounted for 34% of the EV market, with 401,841 units sold. Electric four wheelers sold 47,217 units at 4%, while electric buses sold 1904 units at 0.16%.
However, industry has expressed concern over the suspension of FAME2 subsidies for businesses that do not fulfil localization requirements, claiming that it has hurt sales. According to the SMEV statement, the momentum in electric two-wheeler adoption “fell after the festive season not because of consumer demand but because of the sudden withholding of more than the Rs 1,200 crore subsidy already passed on to customers by the majority of OEMs on the pretext of delay in localisation.”
“Another Rs 400 crore of premium-end OEMs has got delayed owing to the charge of under-invoicing to avoid FAME norms.”
Currently, 16 companies are waiting for this impasse to be resolved.
“While all earlier schemes since 2015 had limited influence on EV adoption, the amended FAME2 had a major effect on e-two wheeler adoption since it reduced their pricing by roughly 35%,” said Sohinder Gill, director general, SMEV. This began to draw the component supply chain, which had hitherto eschewed having to do with electric two-wheelers due to extremely low volumes. Suppliers began lining up to OEMs in late 2021 to demonstrate their readiness to create EV components. Most of these suppliers took the standard 12 to 18 months to localise, and most of them have already begun to build significant capacity.
He stated that the industry is requesting a two-year extension of the qualifying requirements as well as a three to four years extension of the FAME scheme
