Several electric two-wheeler (E2W) manufacturers, including Ola Electric, Ather Energy, Okaya EV, Okinawa Autotech, and Matter Energy, have initiated price revisions due to the reduction in subsidies under the second phase of the Faster Adoption of Manufacturing of Electric Vehicles in India (FAME-II) scheme. While the exact impact of these price revisions has not been disclosed by the companies, industry observers predict a minor effect on sales growth in the coming two to three months.
| Manufacturer | Price Revision |
|---|---|
| Ola Electric | Rs 15,000 increase |
| Matter Energy | Rs 30,000 increase |
| Ather Energy | Rs 8,000 increase |
| TVS Motor | Rs 17,000-22,000 increase |
| Ampere EV | Rs 21,000-39,100 increase |
| Hero Electric | No price increase |
The FAME-II subsidy scheme, which allotted Rs 10,000 crore for three years, was introduced on April 1, 2019. According to the latest notification, the subsidized amount has now been revised to Rs 10,000 per kWh (down from Rs 15,000), with a maximum cap of 15% (down from 20%) of the ex-factory price.
Market leader Ola Electric has raised the prices of its S1 range of products by Rs 15,000. The Ola S1 is now priced at Rs 1,29,999, while the S1 Pro is available at Rs 1,39,999. The most affordable model in their lineup, the S1 Air, will now cost Rs 99,999.
Matter Energy, an EV startup based in Ahmedabad, has announced a price increase of Rs 30,000 for its electric bikes starting from June 6.
Ather Energy has revised the prices of its 450X scooter by Rs 8,000, effective June 1. Consequently, the 450X (with Pro Pack) will be priced at Rs 1,65,000 (ex-showroom Bengaluru). Ravneet S. Phokela, Chief Business Officer of Ather Energy, mentioned that the FAME-II revision resulted in a subsidy reduction of approximately Rs 32,000. However, the company has absorbed a significant portion of this price impact in an effort to expedite the adoption of electric vehicles in the country.
Phokela stated, “In the interest of our customers, we have made efforts to minimize the price hike and have recorded the lowest increase in prices among the industry players following the FAME II subsidy reduction.”
TVS Motor has increased the price of its iQube E2W range by Rs 17,000 to Rs 22,000, depending on the variant. Further details regarding this price adjustment can be found on their website soon, as announced by Manu Saxena, Senior Vice-President of electric vehicles at TVS Motor.
Ampere EV, owned by Greaves Cotton, has also raised the prices of its products by Rs 21,000 to Rs 39,100.
Hero Electric, on the other hand, has decided not to increase the prices of its e-scooter models, distinguishing itself from other companies in the market.
Although the E2W manufacturers have not disclosed the exact impact of these price revisions, industry observers believe that there will be a slight influence on sales growth over the next two to three months.
CRISIL, a rating agency, estimates that the price increase for a vehicle priced at Rs 1.5 lakh could range from Rs 20,000 to Rs 25,000. The agency predicts that the volumes will face pressure for approximately three to four months.
Hemal Thakkar, Director of Consulting at CRISIL Market Intelligence and Analytics, explained, “Due to the difference in subsidy, customers will now have to pay around Rs 20,000 to Rs 25,000 extra as a downpayment for a 3 kWh battery size.
