Update: September 6 | 05:30 PM

The EV startup said in a statement on Wednesday it has raised INR 900 Cr from existing shareholders Hero MotoCorp and GIC through a rights issue.

Ather said it would use the fresh funds to launch new products and expand its charging infrastructure and retail network.

The startup claims to have over 200 retail touchpoints across over 100 cities.

“… We have always believed that this (EV) transition will be led by world class technology and products designed and built in India and this year will be no different with our largest outlay on research and development yet, planned in 2023-24. This round will allow us to expand our product portfolio while expanding our footprint,” Ather CEO and cofounder Tarun Mehta said.

Original Copy: September 4 | 11:20 PM

Bengaluru-based EV startup Ather Energy is raising INR 550 Cr from existing investor Hero MotoCorp. 

Hero MotoCorp, in an exchange filing, said it would invest up to INR 550 Cr in Ather via its rights issue by subscribing to the EV startup’s Series E2 compulsory convertible preference shares.

Hero Motorcorp first invested in the EV startup in 2016 and currently holds a 33.1% stake in it. Its shareholding will further increase following the rights issue, which is expected to close by September 30.

The funding round comes almost 11 months after Ather raised $50 Mn from Caladium Investment. Prior to that, it raised $128 Mn from NIIFL and Hero MotoCorp in May last year as part of its Series E round. 

Overall, the startup has raised a total funding of over $400 Mn till date.

Founded in 2013 by Tarun Mehta and Swapnil Jain, Ather is a major player in the Indian two-wheeler EV market. It currently offers two escooters – Ather 450X and Ather 450S.

Ather also claims to have the largest fast-charging network in the country. It has over 1,400+ charging points in over 99 cities, including Delhi, Chennai, Bengaluru, Mumbai, Hyderabad, Jaipur.

Registrations of Ather’s escooters stood at 6,780 units in August, a marginal rise of 1.6% from 6,671 units in July. Its rival Ola Electric’s registrations declined 10.4% month-on-month to 17,331 units in August but it continued to lead the two-wheeler EV space.

Besides Ola Electric, Ather competes with Ampere, Okinawa, Revolt, TVS, among others.

Ather’s revenue stood at INR 1,806 Cr in FY23, a massive jump from INR 408.5 Cr in FY22, as per Hero MotoCorp’s filing. While the filing didn’t mention profit/loss numbers for FY23, Ather’s net loss rose 47% to INR 344 Cr in FY22.

The post [Update] Ather Energy Raises INR 900 Cr From Hero MotoCorp, GIC appeared first on Inc42 Media.

The electric two-wheeler market has once again started regaining some of its lost momentum, which is evident from the 8% month-on-month (MoM) rise in the total number of vehicle registrations in August.

As per the latest data available on Vahan (as on August 31), total EV registrations in the two-wheeler category rose to 58,927 units during the month from 54,498 units in July. 

We must note that the vehicle registrations nosedived to a 12-month low of around 46K units in June. 

Even though there was an uptick in the number of EV registrations, all major OEMs struggled to see a healthy number of vehicle registrations.

Meanwhile, Ola Electric continued to lead the two-wheeler EV market in August but saw a 10.4% decline in registrations to 17,331 units from 19,340 units in July. In June, the EV maker registered 17,655 units.

The dwindling number of sales comes in the month when the Bhavish Aggarwal-led EV major started the deliveries of its brand new S1 Air escooter.

After opening the purchase window of its latest model in July end, Ola Electric said last week that it had started the deliveries of its new escooters.

The startup also claimed to have already received 50,000 bookings for the escooters. While the Vahan portal does not show the booking numbers, it would be interesting to see if Ola Electric can pick up its vehicle registration pace in the coming months.

Moving on, TVS Motor continued to dominate the second position in the electric two-wheeler market for another month. Its vehicle registration jumped almost 40% MoM to 14,510 units in August.

The company continues to see steady growth. In July, its EV registrations increased to 10,383 units from 7,860 units in June.

We must also note that TVS Motor is plying boldly in the EV ecosystem. It recently launched an INR 2.5 Lakh escooter, TVS X, which is currently the most expensive escooters on sale.

On the other hand, Ather Energy witnessed muted growth as its vehicle registrations rose a mere 1.6% to 6,780 units in August from 6,671 units in July.

Ampere Vehicles saw its vehicle registration nosedive to more than a two-year low to 743 units. On a MoM comparison, its vehicle registration tumbled 47.4% from 1,414 units registered in July.

We must note that Ampere, along with more than a dozen other two-wheeler EV players, came under the government’s security for allegedly violating the minimum localisation norms that were required to claim the subsidy benefits under the FAME-II scheme.

Earlier this year, the central government started penalising these EV players and started claiming back the subsidies they had received from the government.

Ampere was expected to pay INR 124.91 Cr to the Ministry of Heavy Industries (MHI).

While the situation has become difficult for most of these leading OEMs, Ampere parent Greaves Cotton Limited said during its Q1 FY24 earnings that the escooter brand continued its leadership position and achieved a cumulative secondary sales milestone of 2 lakh units till the quarter.

The other most battered electric two-wheeler player, Okinawa Autotech, also saw its vehicle registration decline 14.4% to 1,938 units in August from 2,263 units in July. 

Following the penalties imposed on several OEMs for misappropriation of subsidies, Okinawa was liable to refund subsidies worth INR 116.85 Cr to the MHI.

Despite its escooters catching fire, Okinawa’s vehicle registration stood at 8,759 units in August last year.

Meanwhile, Bajaj Auto has now started taking up more market share in the two-wheeler EV space. Its vehicle registration jumped almost 49% MoM to 6,130 units in August. 

Last month, Bajaj Auto’s EV registrations had seen an over 36% MoM rise to 4,116 units in July.

On the other hand, following the FAME-II woes, Hero Electric’s escooter registrations fell to 756 units, the lowest since 2021. While the EV maker’s registrations slipped 3% MoM, the same was down 14X from 10,602 units in August last year.

Amid the falling demand, the company on Monday (August 31) announced to diversify into the premium EV bike market under the brand, A2B.

Overall, EV sales, including all categories, increased to 1.22 Lakh units in August from 1.16 Lakh units in July. On a year-on-year basis, this is a significant increase from the August 2022 EV registration of 89,006 units.

However, as of now, it remains to be seen if the upcoming FAME-III could change the course of the domestic EV industry, especially after the FAME-II fiasco.

The post Two-Wheeler EV Registrations Rise A Mere 8% MoM In August As Major OEMs Snail Ahead appeared first on Inc42 Media.

Governments and businesses around the world are stepping up their efforts to promote electric vehicles (EVs) to reduce transport-related emissions and combat climate change, and India is no exception. The country has made significant strides in EV adoption, particularly in the two-wheeler segment.

In May 2023, electric two-wheeler registrations crossed the 1 Lakh mark for the first time, despite the government’s decision to slash subsidies under its FAME II (Faster Adoption and Manufacturing of Hybrid and Electric Vehicles) scheme.  

Although some saw this move as a blow to the EV industry, many opined that it would hardly derail the government’s ambitious plan to make 80% of the country’s two and three-wheelers electric by 2030. 

While the country is investing heavily in EV infrastructure, including charging stations and battery swapping stations, private players, too, have boosted their endeavour to innovate and ramp up R&D in the space so that these vehicles could be made more affordable for the masses.  

However, there is a dire need for the government and private players to be on the same page for the larger good of the country and the world at large.

According to the cofounder and CEO of EV manufacturer HOP Electric Mobility, Ketan Mehta, the active collaboration between policymakers and private players has the potential to put the country’s EV industry and adoption on a high-growth trajectory. 

However, the CEO believes that the government has done its bit by providing the necessary launch-pad to private players, and it’s time for the industry to gradually reduce its reliance on government subsidies.

Founded by engineers Mehta, Nikhil Bhatia and Rahil Gupta in 2019, the Jaipur-based startup manufactures electric two-wheelers (motorcycles and scooters). 

In an interaction with Inc42, Mehta talked about the growth drivers, challenges the future outlook of India’s EV market. 

Here are the edited excerpts

Inc42: Tell us how EV makers, like yourself, are helping the government achieve its target to electrify all two-wheelers by 2030.

Ketan Mehta: In line with the government’s push for sustainable mobility, prominent EV players are actively engaged in developing in-house technologies, conducting R&D to improve EV performance and exploring technologies that enhance the vehicle experience with applications like AI, IoT and telematics.  

EV players are also working towards establishing an extensive network of charging infrastructure across the country, which happens to be one of the most significant challenges for the EV industry. 

At HOP, we are developing a first-of-its-kind decentralised network of smart batteries, home chargers and charging & swapping stations called the HOP Infinity Energy Network. We have already launched a pilot with five swapping stations and 50 batteries in Jaipur and are now aiming to expand to more cities and states.

I believe that collaborative efforts are nurturing the growth of the domestic EV industry and will definitely contribute towards India’s sustainable future. 

Inc42: The FAME II subsidy cut has garnered mixed responses, with some arguing that it could make EVs more expensive for consumers. What are your thoughts on this?

Ketan Mehta: From price-sensitive customers to mid-segment and luxury aspirants, all types of consumers are becoming increasingly aware of the benefits of owning an EV. 

I feel the government has done its bit by providing the necessary launch-pad to private players, and it’s time that we gradually reduce our reliance on subsidies.

Consumers don’t buy a vehicle just for the sake of commuting. They look for new-age features such as biometric-recognition systems and other solutions that enhance their driving experience. Hence, a well-packaged product that offers sustainability and performance is a must to hold the interest of potential customers.

Right-value products for the masses will definitely shape the EV segment going forward. From manufacturing at scale to providing easier ownership options, we are taking many initiatives to accelerate the adoption of EVs. 

Inc42: Speaking of price-sensitive customers, what initiatives are EV stakeholders taking to ensure affordability? Tell us how this could unlock India’s EV potential.

Ketan Mehta: There is a remarkable transformation in the lending space and financial institutions now weigh environmental factors into their decision making. 

This allows them to offer special rates to individuals purchasing EVs, thus encouraging the adoption of sustainable transportation. So, you can say that easy financing options have become the catalyst for the cause.

Meanwhile, OEMs can make vehicles more affordable by pricing them competitively and developing them with specific target audiences in mind. It’s a well-known fact that EVs are costlier than ICE (internal combustion engine) vehicles as the battery cost increases the price of vehicles.

 In such a scenario, offering a Battery-as-a-Service option sweetens the deal! This helps separate the battery cost from the vehicle purchase price and customers pay a fee depending on the usage of batteries. 

Inc42: One of the biggest challenges for the domestic EV industry is its over-dependence on the imports of EV cells. How can indigenous EV battery manufacturing fuel EV adoption in such a scenario?

Ketan Mehta: The vision of ‘Atmanirbhar Bharat’ aims at self-reliance across sectors and the country seems to be on the right track. 

In July this year, India joined the coveted Mineral Security Partnership (MSP), a US-led collaboration of 14 countries, which is aimed at catalysing public and private investments in critical mineral supply chains. Interestingly, India is the only developing nation among the 14 nations under MSP. This gives us some strategic advantage in securing crucial resources to increase the production of indigenous EVs. 

Further, the recent discovery of lithium reserves in Rajasthan’s Degana, after Jammu & Kashmir, will only strengthen India’s position in the EV market. 

I think the commitment towards localising the EV supply chain is vital if we want to achieve self-reliance. Both public and private sectors should focus on developing a robust ecosystem of domestic suppliers for raw materials, components and spare parts used in EV manufacturing. This move will curtail dependence on overseas sourcing, strengthen local manufacturing and enhance India’s self-sufficiency in the EV space.

Inc42: Do you think that the growing demand for sustainable mobility is driving investment in EV startups?

Ketan Mehta: In an era where connected, digital and sustainable mobility is the need of the hour, there is a need for investment and a conducive regulatory framework. 

According to the Economic Survey 2022-23, the domestic EV market is expected to touch 1 Cr units in annual sales by 2030. Such aspirational numbers require capital for vehicle production and charging infrastructure.

In terms of institutional funding, the EV startup ecosystem raised a record $1.66 Bn in funding in 2022, up 117% YoY. And this is just the tip of the iceberg! I am confident that the sector will continue to attract investor interest with the same spirit.

Last year, we closed a strategic round of $2.6 Mn, as part of our ongoing $10 Mn pre-Series A fundraiser. Our strategic investor, a listed company, has previously supported us in becoming a successful mandate holder of the government’s ambitious Production Linked Incentive (PLI) scheme. We remain committed to investing more than INR 2,000 Cr in new products and charging infrastructure over the next five years.

Inc42: Could you shed some light on how you are utilising these funds? Also, tell us how you are creating a holistic EV network to boost EV adoption.

Ketan Mehta: We have taken a platform-based approach to our product development strategy. We are working on four platforms and will be launching 12 new products on these platforms in the next five years. 

• Platform Nimbus: This is a utility-based platform to develop vehicles in both B2B and B2C spaces. These vehicles will be equipped with multi-battery architecture swap support and we are targeting Indian and African markets with these vehicles
  
• Platform Alpha: This is a B2B-focussed platform for B2B applications, such as hyperlocal deliveries, food deliveries and last-mile deliveries, in the ecommerce sector.
• Entry-Level Scooter Platform: We are designing scooters for new or first-time buyers (typically those who are looking for affordable and easy-to-use modes of personal transportation).
  
• Platform OXO: Through this platform, we will be launching different motorcycles both in the commuter and sports segments.

The post Indigenous R&D And Cell Manufacturing Key For Faster EV Adoption: HOP Electric Mobility’s Ketan Mehta appeared first on Inc42 Media.

Mumbai-based electric two-wheeler startup One Electric has started production of its EV motorcycles in Kenya as part of its larger overseas expansion plan.

One Electric has set up a joint venture with a Kenyan vehicle manufacturing company to begin production of its Kridn motorcycles, as per an ET report. For now, the components, tech and technical know-how are coming from India.

Local manufacturing will help the startup scale its operations faster in Africa and provide localised after-sales service. The startup is also preparing to start production at a second plant in Kenya, with production set to begin in two months, the report said.

“Our engineers are overseeing the training and production of our motorcycles in Kenya to ensure our standards,” Gaurav Uppal, CEO of One Electric, was cited as saying. The CEO added that the startup was on track to complete the first production batch within two weeks.

The move is part of the startup’s plans to have multiple manufacturing locations across Africa and Asia, the CEO said. According to Uppal, the EV manufacturer will start localisation in a phased manner, as per the viability of the local industry, starting with parts like handlebars, stands and carriers. 

Once the local ecosystem develops, the startup will increase its localisation in Kenya.

The startup also has plans to set up a battery manufacturing plant in Africa by the end of the year. After Africa, One Electric is looking to expand into other markets like South America and Southeast Asia and has already started talks with local partners.

One Electric, founded in 2019, manufactures four vehicles under its Kridn range of bikes for intracity commuting. One Electric claims to have sold vehicles across six countries and has partnered with Indian OEMs to manufacture electric bikes and source parts.

The startup competes with the likes of Ola Electric, Ather, TVS, Hero and dozens of other EV manufacturers specialising in ebikes.

While ebikes are yet to catch up to the popularity of escooters, there are a few Indian OEMs that manufacture EV bikes, including Ultraviolette, Yulu and Kabira Mobility, with Ola Electric set to join the group in 2024 with its set of four bikes announced recently.

The post One Electric Commences Manufacturing In Kenya, Eyes Further African Expansion appeared first on Inc42 Media.

At a time when commercially viable battery charging technologies worldwide take a minimum of 30 minutes to a maximum of 10 hours to fully charge electric vehicles (EVs), depending on battery capacity and vehicle types, Bengaluru-based Exponent Energy claims to have broken all records with its 15-minute EV charging tech, with the vehicle category no bar.

The startup has made 15-minute rapid charging an on-road reality with its patented ‘water-based’ off-board thermal management system.

But before we delve deeper into the technology and Exponent Energy’s journey in building its tech stack, it is pertinent to understand why such a technology is groundbreaking. 

In an attempt to make the usage of EVs more seamless, various players across the globe are working on curbing the EV charging time down to as low as 10 minutes.

However, so far, only a handful of players, including Tesla, California-based Enevate, and European tech giant ABB, have been successful in achieving this and that too for certain use cases, while many such technologies are still being championed in ultra hi-tech labs.

Amid this, India’s Exponent Energy’s tech innovation is applicable across use cases. The tech not only reduces charging time but also enhances the life of EV batteries, thereby making them cost-effective in the long run.

Spilling The 15-Minute Rapid Charging Beans

Former Ather Energy executives Arun Vinayak and Sanjay Byalal founded Exponent Energy in 2020, with the sole motive of building a tech enablement platform that can help original equipment manufacturers (OEMs) across segments to go electric with unmatched agility.

According to CEO and cofounder Vinayak, the only hurdle in the path of EV adoption in India is the efficiency of these vehicles, which can be improved multifold.

“Our problem statement in focus was battery life, battery charging times, the charging network… this is where the energy stack was really broken, and we needed to make energy much faster, simpler, accessible, and affordable,” Vinayak said.

When it comes to rapid charging, the biggest hurdle is overheating of batteries and battery life degradation. A 15-minute rapid charging generates almost 256X more heat than a 4-hour charging, which is the industry average. 

Notably, lithium-ion (Li-ion) batteries are highly sensitive to extreme temperature conditions. Hence, battery thermal management systems are crucial for these battery packs as they help them function seamlessly even in extreme temperatures.

In most cases, various cooling systems such as air cooling, liquid cooling, and phase change material cooling are used worldwide to keep these batteries at their optimal temperature. 

However, according to Vinayak, liquid cooling systems, which are the most common solution for thermal management in EVs today, hardly solve this problem, particularly in countries like India where the ambient temperature is normally 40 degrees Celsius or higher.

To resolve this, Exponent has built an advanced heating, ventilation, and air conditioning (HVAC) system, which is ‘off-boarded’ from the vehicle and is deployed at its charging stations, ‘e^pump’. 

EV players like Tesla, Lucid, and Hyundai also have advanced HVAC systems, but the only issue is that these systems are an integral part of their vehicles and make them heavier and more expensive.

To resolve this pain point, the startup has built chargers and charging stations that come with this technology, reducing the burden on OEMs to incorporate such technology in EVs.

Its charging station, ‘e^pump’, transfers refrigerated water through its charging connector, ‘e^plug’, preventing Li-ion cells in its batteries from getting overheated while charging. The technology ensures that the temperature of its battery packs, ‘e^packs’, doesn’t exceed 35°C in any climatic condition. 

Overall, Exponent Energy’s secret sauce of efficient 15-minute rapid charging is engrained in its tech stack that comprises ‘e^packs’, ‘e^pumps’, and ‘e^plugs’.

Making Batteries Last Longer

Besides reducing the charging time by controlling overheating, Exponent Energy has also been able to increase battery life by controlling lithium plating – the formation of metallic lithium around the anode of Li-ion batteries during charging.

Lithium plating is a phenomenon that degrades battery life and leads to battery malfunction. 

While newer and more advanced cell chemistries are being developed to change the anode itself at a fundamental level, they are not mainstream yet.

“We are using the same material science and same anode but using a more software and electronics-based approach to smartly push the same anode to do more without actually damaging it,” Vinayak said. He added that the startup’s BMS and charging algorithms have been able to address the problem of lithium plating at the grassroots level, increasing the battery life.

Building The Business

Since its inception, Exponent Energy has raised $18 Mn in total funding from the likes of Lightspeed India, YourNest VC, 3one4 Capital, AdvantEdge VC, Hero MotoCorp’s chairman and CEO Dr Pawan Munjal’s family office, and Motherson Group.

Enabling efficient last-mile deliveries being the startup’s major focus area, it partnered with one of the leading OEMs in the three-wheeler commercial vehicle segment, Altigreen Propulsion Labs, in 2022. It claims that EVs powered by its tech stack have already covered over 10 Lakh kms with more than 25,000 rapid charging sessions. 

However, the only catch here is that the startup sells its entire tech stack as a solution, and its ‘e^pumps’ can only charge ‘e^packs’. It has its ‘e^pumps’ at 30 locations in Bengaluru, which generate revenues on a subscription basis, based on the energy consumed per vehicle.

The startup’s ‘e^packs’ can be charged anywhere but they take at least an hour to fully charge. For maximum 15-minute efficiency, the battery packs need the company’s proprietary ‘e^plugs’ and ‘e^pumps’.

All of Exponent’s battery packs, which are also cell agnostic, come with a warranty of 3,000 cycle life, 3X the industry standard. They cost almost 30% less than other EV batteries in the market, as per the company.

Charging Ahead

After establishing its first set of charging networks in Bengaluru, Exponent Energy is planning to expand its operations to five more cities – Delhi NCR, Mumbai, Hyderabad, Chennai and Ahmedabad – by the end of the financial year 2023-24.

The startup has also set an ambitious target of deploying 1,000 ‘e^pumps’ and 25,000 Exponent-powered EVs by 2025 in the aforementioned cities, eyeing a revenue of around INR 600 Cr during the year.

Currently, more than 200 EVs powered by the startup are running on Bengaluru roads.

Vinayak says that as an energy company, Exponent is more focussed on high-energy value products, hence the startup is not looking to enable two-wheelers right now. After three-wheeler commercial vehicles, it would target the three-wheeler passenger vehicle market.

Besides, Exponent is all set to soon launch 15-minute rapid charging capabilities for intercity ebuses as well as etrucks by next year.

It must be noted that the ebuses market is slowly getting more mature in the country, with existing and new players launching intercity bus services with well-established charging networks. Currently, FreshBus and NueGo are the two main players in this market, with the likes of ZingBus expected to enter the market soon.

While Exponent currently faces minimal competition in India, more players could emerge with advanced cell chemistries and battery tech as the EV industry keeps growing. To substantiate this fact, Bengaluru-based EMO Energy has also launched 30-minute chargeable portable battery packs for various vehicle categories. 

Meanwhile, big players like Ola Electric are working on building their own cell and battery technology, though it remains to be seen if, and to what degree, the upcoming technologies would prove to be pathbreaking in the near future. 

The post Locking Horns With Tesla? Here’s How Exponent Energy Has Made 15-Minute EV Charging A Reality appeared first on Inc42 Media.

Sales of most electric two-wheeler startups continued to remain under pressure in July, still recovering from the impact of FAME-II issues and the changes in government subsidies under the scheme.

Though total EV registrations in the two-wheeler category rose to 54,232 units in July from 45,991 units in June, as per Vahan data on August 1, the number of registrations in July was lower than in each of the months during the January-May 2023 period. 

Ola Electric retained its top spot with 19,237 registrations in July. On a month-on-month (MoM) basis, it was a 9% jump from 17,623 units registered in June. Despite this, Ola Electric’s July demand was almost at the January 2023 level.

Moving on, Ola Electric now holds an almost 35% share in the electric two-wheeler market with the dwindling market traction for the escooters of Okinawa Autotech, Hero Electric, and Ampere Vehicle, who were giving serious competition to the Bhavish Aggarwal-led EV major.

Ola Electric will soon start delivering its more affordable escooter, Ola S1 Air, which is expected to catalyse its sales.

“With our revolutionary yet affordable S1 Air receiving an overwhelming response, we are well-positioned to accelerate India’s EV penetration by driving mass market adoption in the scooter segment. The highly versatile and accessible S1 Air is the perfect answer to ICE scooters, and with its unmatched TCO (Total Cost of Ownership),” said Ankush Aggarwal, chief business officer, Ola, in a statement on its July sales.

After Ola Electric, TVS Motor maintained its second position with 10,330 units of vehicle registrations in July, up 31.5% MoM. However, the number was still 49% below its record vehicle registration of 20,416 units in May.

Demand for Ather Energy escooters recovered more than 43% MoM to 6,607 in the last month but was down 57% from 15,416 units of record vehicle registrations witnessed in May.

In a statement, the Bengaluru-based EV startup said it sold 7,858 units in July 2023.

“Post the FAME-II subsidy revision in June, the EV industry saw a dip, but we already see it bouncing back. With the festive season on the anvil, the volumes are expected to grow faster. In line with this growth, we are seeing our volumes also growing and we are now gearing up for the festive season,” said Ravneet Singh Phokela, chief business officer, Ather Energy.

Ather Energy has also started taking pre-booking of its upcoming scooter, 450S, which is expected to be launched on August 11.

Bajaj Auto’s vehicle registrations, too, rose 36% to 4,086 units last month, making it the fourth-biggest market player in the Indian electric two-wheeler space.

Meanwhile, vehicle registrations of most other players, including Okinawa, Ampere, Hero Electric, Pure EV, and Jitendra EV, have continued to stagger. While Hero Electric’s vehicle registration tanked 31.5% MoM to 778 units in July, Okinawa’s registration volume slipped 13.4% MoM to 2,263 units.

It is pertinent to note that more than a dozen electric two-wheeler players have recently been probed by the government and many of them have been given an embargo on future sales of vehicles for alleged misappropriation of the FAME-II subsidies. They have also been slapped with penalties. Meanwhile, these manufacturers have also passed on crores of rupees as subsidies to customers but are yet to receive them as incentives from the government.

Adding to their troubles, the central government has also slashed the incentives allocated for electric two-wheelers under the FAME-II scheme to 15% of ex-factory price from the earlier 40% and cut the demand incentive to INR 10,000/kWh from INR 15,000/kWh earlier.

This has made several EV players, including Ola Electric, Ather Energy, Matter, and AMO Mobility, increase their vehicle prices from June this year.

Electric two-wheeler registrations crossed the 1 Lakh mark for the first time in May this year. Total EV registration across categories stood at 1.15 Lakh units in July as against 1.02 Lakh units in June and 1.58 Lakh units in May.

The post Electric Two-Wheeler Sales Show Slight Recovery In July But FAME-II Scars Still Visible appeared first on Inc42 Media.

Foxconn’s Mobility in Harmony (MIH) CEO Jack Cheng hinted that the company is eyeing India as one of its target locations to build a standardised electric vehicle (EV) production unit. 

MIH is the EV manufacturing unit of the Taiwanese tech giant that announced plans to launch a three-seater EV priced below $20,000. 

Cheng told Reuters that MIH is willing to work with its parent or collaborate with some other EV manufacturing company to produce the said category of EV. For the same, the company is reportedly in talks with convenience stores, car rental companies and logistics companies and aims to close the talks before it unveils the prototype this October. 

Chengg did not reveal the names of the companies that MIH is in talks with but confirmed that the price of the EV will range between $10,000 and $20,000. Other than India, the EV maker is also considering Thailand for the production site.

He said, “You build where the potential market is…In India or Southeast Asia, you have a huge volume opportunity right now.”

Further adding to this, Cheng said that he wants to build another Shanghai, probably in India. “If this is a Foxconn plant, fantastic, it’s the mother company, we put it into the Foxconn plant. If this is a local India plant and it’s even more competitive, give it to the India plant,” he added.

Earlier also, the company had hinted at plans to make India one of its bases for manufacturing EVs. In its annual report 2022, Foxconn stated that in addition to information and communication technology (ICT) products, it is also planning to venture into the EV space. 

Back then, Foxconn said that for semiconductors, the company is setting up a complete supply chain and there are plans to launch a joint venture in India for the 12-inch wafer fab. 

However, soon after, it announced that it would pull out of the joint venture worth $19.5 Mn with the Indian metals-to-oil conglomerate Vedanta to produce semiconductors in India. The deal was signed in 2022 to manufacture semiconductors in Gujarat. 

The development comes at a time when Tesla officials are on a visit to India for consecutive meetings on setting up an EV and components manufacturing plant in the country. The executives reportedly met Invest India’s new CEO Nivruti Rai on Thursday (July 27) and had plans to meet commerce and industry minister Piyush Goyal soon. 

During PM Narendra Modi’s US visit, Musk told the media, “I am confident that Tesla will be in India and will do so as soon as humanly possible.”

The post Foxconn Subsidiary Hints At Setting Up EV Manufacturing Unit In India appeared first on Inc42 Media.

The global automotive industry is shifting significantly towards electric vehicles (EVs) to combat climate change and reduce carbon emissions. 

India, too, is steadily moving towards electrification. In 2022, as per Vahan, EV sales in India hit the mark of 10,23,735 units, and until March 2023, the number was already hitting an impressive milestone of 11,65,057 units. This substantial jump in the numbers indicates the readiness of consumers to embrace the EV alternative to high petrol and CNG charges. 

Furthermore, with the government announcing an ambitious target of 30% electrification of the country’s vehicle fleet by 2030, the supply is more likely to tilt in favour of EVs. 

However, while the growth is incredible, the EV market in India is still nascent, and the transition toward electric mobility presents unique challenges for the retail sector.  One of the recent challenges is the reduction in the FAME II subsidy, which is now being talked about across the industry. It is just one among many other blockers for EV retailing which require immediate action. 

Financing Challenges

One of the significant challenges in retailing is financing. EVs are still relatively expensive in India, and customers may not be willing to invest a considerable amount of money upfront. Moreover, unlike conventional vehicles, EVs require a significant upfront investment in the battery, the vehicle’s most expensive component. 

To overcome financing challenges, EV retailers must work closely with banks and financial institutions to develop innovative financing solutions that address customer concerns. This could include offering attractive loan schemes with low-interest rates, long repayment periods, and a buy-back guarantee. 

Service Unavailability

Another significant challenge in EV retailing is the unavailability of service centres. EVs require specialised equipment and trained personnel for servicing and repairs. However, India currently needs more such service centres, making it difficult for customers to get their vehicles serviced and repaired.

To overcome this challenge, EV retailers must invest in setting up service centres and training personnel in EV technology. They could also partner with existing service centres to provide training and certification programs to their mechanics.

Limited Competency

The industry is upcoming and always innovating which mandates the need to include more expertise in EV technology. In addition, many customers may need to be more familiar with the features and benefits of EVs, which can lead to confusion and a lack of confidence in the product.

To overcome this challenge, EV retailers must invest in educating customers about EV technology and the benefits of electric mobility. This could include organising workshops, roadshows, and test drives to educate customers about the product.

Community Awareness About The Product

Mechanics are the backbone of the automotive service industry, but there needs to be more awareness among mechanics about EV technology. In addition, many mechanics may need to be equipped to handle EV repairs, which can lead to delays and a lack of trust among customers.

To overcome this challenge, EV retailers must invest in training and certifying mechanics in EV technology. This could include collaborating with technical schools and institutes to provide training and certification programs for mechanics.

Range Anxiety

Range anxiety is one of the most significant concerns among potential EV customers. Moreover, customers may need to be reassured about the vehicle’s range and charging infrastructure availability, especially in rural areas.

To overcome this challenge, EV retailers must invest in a robust charging infrastructure network. This could include setting up charging stations at strategic locations, including highways, public parking lots, and commercial centres. Retailers could also offer customers home charging solutions to address range anxiety.

Unfamiliarity

The traditional Indian mindset when it comes to purchasing vehicles is still prevalent, and many customers may need to be more familiar with the features and benefits of electric mobility. In addition, customers may also be sceptical about the reliability and durability of EVs.

To overcome this challenge, EV retailers must educate customers about electric mobility’s benefits. This could include organising workshops, roadshows, and test drives to familiarise customers with the product.

Safety Concerns

Safety is a critical concern for customers, and EVs present unique safety challenges due to their high-voltage batteries. Customers may also be concerned about the safety of charging infrastructure and the risk of fires.

To overcome this challenge, EV retailers must invest in ensuring the safety of their products and charging infrastructure. This could include implementing strict safety protocols and standards for EVs and charging stations. Retailers could also provide customers with safety training and information on handling EVs safely.

Life Of The Product

The market’s novelty also comes with limited product life information. Customers may be hesitant to invest in an EV due to concerns about the durability and longevity of the vehicle.

To overcome this challenge, EV retailers must invest in providing customers with information on the product’s life. This could include providing warranties and guarantees on the battery and other components of the vehicle. Retailers could also conduct research and studies on the durability and longevity of EVs to provide customers with accurate information.

Push Marketing

EV retailers must adopt effective marketing strategies to promote their products and services. Traditional marketing methods may need to be more effective in promoting EVs due to the unique challenges of electric mobility.

To overcome this challenge, EV retailers must adopt push marketing strategies that educate customers about electric mobility’s benefits. This could include social media campaigns, influencer marketing, and content marketing, providing customers with accurate and relevant EV information.

EV retailing presents unique challenges in India. However, by investing in innovative solutions and adopting best practices, EV retailers can overcome these challenges and drive the growth of electric mobility in India. In addition, EV retailers can help accelerate the transition toward a cleaner and more sustainable future by providing customers with education, safety, and reliable products and services.

The post Driving Electric Mobility: How EV Startups Can Tackle Competency & Awareness Hurdles appeared first on Inc42 Media.

In a bid to mitigate the impact on the electric two-wheeler manufacturers that have been penalised for alleged misappropriation of FAME-II subsidies, industry body Society of Manufacturers of Electric Vehicles (SMEV) has come up with a solution, which seems to be strange, to say the least.

Proposing a ‘compromise’ to pay back to the public exchequer, the industry body wants the government to allow the companies to recover subsidies from the customers to whom the vehicles have already been sold.

The latest, and seemingly impossible, proposal comes after repeated letters to the Indian government to take steps to save the afflicted original equipment manufacturers (OEMs) that have been penalised for taking the benefits of subsidies under the FAME-II scheme without adhering to the minimum localisation norms.

In a letter to the Ministry of Heavy Industries (MHI) on Friday (July 28), Sanjay Kaul, the chief evangelist of SMEV, said, “Considering that your department levied a penalty on some OEMs a few months ago for overcharging the customers and then asked them to return the amounts, it is possible that the monies you are currently demanding from the other set of OEMs for non-compliance, can be similarly recovered by them from the customers and returned to the Department.”

It is pertinent to note that there were two main problems that led to the entire FAME-II fiasco in the last few months. In the first case, which started in the second half of last year, at least 14 OEMs, including the likes of Okinawa Autotech, Hero Electric, Revolt, Ampere, and several others, were being probed for allegedly not abiding by the minimum localisation norms under FAME-II and claiming the incentives. 

As a result, these OEMs also passed on crores of rupees to the customers as vehicle subsidies.

The second issue showed up earlier this year when four OEMs – Ola Electric, Ather Energy, TVS Motor, and Hero MotoCorp – came under the government’s scanner for keeping their vehicle prices artificially lower to claim FAME-II subsidies by charging customers separately for charger and software.

Subsequently, the MHI asked these companies to pay an aggregate amount of around INR 288 Cr to their customers, which they had overcharged. 

Hence, SMEV has now drawn upon this incident to propose that if overcharged monies can be given back to the customers then overpaid monies can also be taken back, which would ultimately save OEMs.

“There is perfect equivalence: one has overcharged; the other has overpaid. I have had this looked at from the legal prism, and it seems to hold water. If a customer has received a discount over and above the correct price, it is incumbent on him or her to return the excess, even if the correction comes retrospectively,” said SMEV in a letter to the ministry.

“Since the MHI is suggesting that the subsidies passed on to customers by OEMs now stand cancelled – due to technical reasons decided by MHI Department subsequently – the customers who have taken such subsidies can be asked to return these to OEMs in all fairness,” the letter added.

The development also comes after several OEMs, caught in the deadlock of the first issue, have reportedly been asked to return subsidies worth INR 469 Cr. 

Hero Electric is expected to pay back the highest amount of INR 133.48 Cr. Meanwhile, Ampere will have to pay back INR 124.91 Cr and Okinawa’s dues stand at INR 116.85 Cr. 

SMEV had earlier written in its letter to NITI Aayog how the FAME scheme gave birth to a spurt in the premium EV bikes at the cost of commuter scooters, calling it an “elitist program”.

It goes without saying that premium segment scooters from Ola Electric, Ather Energy, and TVS Motor have continued to gain increased market share while the players like Hero Electric and Okinawa, who were among the top electric two-wheeler players in 2022, have seen a sharp decline.

“The OEMs are struggling to stay afloat; investors are wary; banks are withdrawing; employees are fleeing; debts are rising, and closures are the next imminent step,” SMEV had earlier said.

Besides, there is also a FAME-II subsidy due of INR 1,200 Cr that the government hasn’t reimbursed to the OEMs.

Speaking about its latest proposal, SMEV said that the task looks “daunting” but after analysis, it seems “it is merely a reversal of the kind you have already decreed in the earlier case”.

As per the latest letter to the MHI, OEMs have also shown a willingness to share customer data with the government to solve the matter. Else, they are willing to take out a public notice asking such customers to deposit back the excess rebates they had received as subsidy, under the department’s guidance.

Speaking to Inc42, Vinkesh Gulati, chairman research & academy, Federation of Automobile Dealers Associations (FADA), said that the government won’t agree to such a proposal as the responsibility of subsidies is on manufacturers and not customers.

“Why would the government go to collect it from customers? The subsidy is not as per the customer’s choice, it is as per how a manufacturer has made a vehicle,” he said.

Amid this ongoing tussle between the OEMs and the government, total electric vehicle sales have dropped sharply after May. After touching a record high of over 1 Lakh registrations in May, two-wheeler EV registrations in June fell to 45,977 units in June. So far in July, the number stands at 47,331 units, as per Vahan data.

The post SMEV’s Solution To FAME-II Deadlock: Recover Subsidies From Customers appeared first on Inc42 Media.

Zypp Electric on Thursday (July 27) became the latest Indian startup to announce a ESOP buyback programme. The EV-as-a-service platform said it will buy back ESOPs of 15 employees. 

The startup, which said it has allocated INR 1.5 Cr for the programme, claimed that it is the first company in the country’s electric vehicle (EV) space to come out with a ESOP buyback programme.

In a statement, the startup said that its initiative has resulted in many more employees coming forward to avail ESOP opportunities. 

“We believe every team member plays a crucial role in our success, and this ESOP buyback is a step towards ensuring their well-deserved share in the company’s growth. Employees have realised the value of up to INR 50 Lakh individually,” Zypp Electric CEO and cofounder Akash Gupta said.

Zypp Electric, founded in 2017 by Gupta and Rashi Agarwal, provides electric scooters to local merchants and ecommerce companies for last-mile deliveries. The startup counts the likes of Swiggy, Zepto, Flipkart, Rapido and Amazon among its clients.

Zypp Electric claims to currently have a fleet of over 16,000 electric scooters. It has around 500 employees.

Earlier this year, the startup raised $25 Mn in its Series B funding round, which was a mix of equity and debt. The round was led by Taiwanese battery swapping major Gogoro. Overall, it has raised a total funding of $37.5 Mn till date.

Zypp Electric, which counts Venture Catalysts, LetsVenture and 9Unicorns among its backers, plans to expand its fleet size to 2 lakh EV scooters by 2025.

With increasing awareness about climate change and focus of companies on reducing their carbon emissions, the demand for EVs is expected to grow rapidly in the country in the coming years. A number of Indian startups, including Zypp Electric, are looking to cash in on this opportunity.

The latest development comes at a time when a number of startups are going for ESOP buybacks to reward their employees. Earlier this week, foodtech giant Swiggy announced a ESOP liquidity programme worth $50 million, while Flipkart began a $700 Mn ESOP payout to its employees following separation of PhonePe from the company.

With the growth in the country’s startup ecosystem, ESOPs have become a popular tool for startups to attract and retain talent. An increasing number of startups are also buying back ESOPs. As per Inc42 data, Indian startup employees made over $196 Mn through buybacks in 2022.

The post Now, Zypp Electric Joins ESOP Buyback Race appeared first on Inc42 Media.

The union government has reportedly asked seven two-wheeler electric vehicle (EV) makers to return subsidies worth INR 469 Cr for flouting localisation norms under the Faster Adoption and Manufacturing of Electric Vehicles (FAME)-II scheme. 

The Hindu businessline, citing sources, reported that the Centre has issued directives to major homegrown players such as Hero Electric, Okinawa, Ampere, Revolt, among others, to pay back the subsidies.. 

A senior government official reportedly said that the failure to refund the amount would lead to de-registration of the erring companies from the scheme in the next seven to ten days, adding that the players would not be allowed to participate in the scheme in the future. 

As per the report, Hero Electric would have to pay the highest amount of INR 133.48 Cr, followed by Ampere at INR 124.91 Cr. Meanwhile, Okinawa is liable for refunding subsidies worth INR 116.85 Cr. 

The crackdown comes close on the heels of an investigation by the Ministry of Heavy Industries (MHI), the nodal body for the scheme, which found that the seven EV manufacturers availed ‘fiscal incentives under the scheme by violating the norms’.

“As per the rules of the Scheme, incentives were allowed to make EVs by using made in India components. But, in the investigation, it was found that these seven firms have used imported components,” an MHI official told the publication. 

This comes a day after Hero Electric, Benling Motors and Ammo Mobility urged the Prime Minister’s Office (PMO) to push the MHI to resolve the matter, saying the penalties could force EV OEMs to file for bankruptcy.

The FAME-II scheme, launched in 2019 with a total outlay of INR 10,000 Cr, was aimed at increasing EV adoption in the country by supporting 10 Lakh electric two-wheelers, 5 Lakh electric three-wheelers, 7,000 electric buses, and 55,000 electric four-wheeler passenger cars through subsidies.

However, the government found that many EV two-wheeler manufacturers claimed subsidies without adhering to mandatory localisation norms. 

Following this, the government paused releasing subsidies to many of the players. Since then, EV industry bodies and individual players have written to the government, saying its moves are hurting the EV targets of the country.

However, the government has remained adamant. Following the findings of wrongdoings, the MHI also cut incentives under the FAME-II scheme to 15% of the ex-factory price of a two-wheeler EV from 40% earlier. It also slashed the demand incentive to INR 10,000/kWh from INR 15,000/kWh previously.

As a result, OEMs were forced to hike prices, which, in turn, hit demand. EV registrations plummeted 56% month-on-month (MoM) in June to 45,734 units, the lowest in the last 12 months. 

The post FAME-II Fiasco: Govt To Recover INR 469 Cr From Hero Electric, Okinawa, Other EV Players appeared first on Inc42 Media.

Bengaluru-based industrial robotics startup Ati Motors on Friday (July 21) said it has raised $10.85 Mn in its Series A funding round led by Silicon Valley-based venture capitalist (VC) True Ventures. 

The round also saw participation from Athera Venture Partners and existing investors like Blume Ventures, Exfinity Ventures, and MFV Partners. 

Ati Motors plans to use the fresh funds to expand its business in the US, South East Asia, Japan, and Europe and accelerate the development and deployment of its existing and new product lines.

Founded in 2017 by Saurabh Chandra, Ati Motors is an autonomous mobile robot manufacturer that helps manufacturers in various sectors optimise productivity and streamline operations by deploying its robotics technology. The startup, which was focused on the automobile sector so far, counts the likes of TVS Motor, CEAT, and Hyundai among its clients. 

With the latest fundraise, Ati Motors will also explore opportunities across the chemicals, pharmaceuticals, maritime, and injection molding sectors.

“A major differentiating factor for us is that while a lot of robotics companies are only targeting ecommerce, which is, of course, a great market, we have found our product market fit in the manufacturing sector,” Ati Motors CEO Chandra told Inc42.

“There is a lot of trolley movement inside factories – it could be from store to the shop floor, the reverse movement of finished goods from the shop floor to the warehouse, or from one part of the factory to another. We have been able to completely automate these with our technology,” he said.

Besides selling its robots, the deeptech startup also provides robotics-as-a-services (RaaS).

“The team’s ability to design autonomous robots that operate in demanding manufacturing environments, is a testament to the availability of multidisciplinary skills in the Indian startup ecosystem,” said Parag Dhol, partner at Athera Ventures, in a statement on the fundraise.

Currently, Ati Motors has customers across India and the US. Chandra said that the startup’s products are deployed in over 30 manufacturing plants currently. With further expansion in the pipeline, it plans to have its industrial robots deployed in more than 100 plants by next year.

The company has two products deployed right now – Sherpa Tug (1-tonne trolley mover) and Sherpa RollerTop (carries up to 50kg payload bridging conveyor systems).

Along with the fundraise, Ati Motors is also unveiling a product called Sherpa Pivot today in Bengaluru. This robot can carry bins, or, mount a robotic arm, or work as a flexible assembly line carrying a bike from one station to another. Besides, the startup will also unveil Sherpa Tug v4, an updated version of the existing Sherpa Tug. 

Ati Motors claims to have developed mechanical vehicles, electronics, and the complete software stack in-house.

The startup has raised $17 Mn in total, including the latest fund infusion. It had raised $3.5 Mn in pre-Series A round in 2021. Prior to that, it raised seed funding from US-based early-stage VC Village Global, which is backed by Bill Gates, Mark Zuckerberg, and Jeff Bezos, among others.

Ati Motors competes with the likes of GreyOrange and Ottonomy, among several others.

The market for autonomous robots is growing at a rapid pace and the space is brimming with opportunities in India as well as globally. As per a report, the Indian industrial automation market’s size is expected to soar to $25.8 Bn by 2028 from $13.25 Bn in 2023.

The post Robotics Startup Ati Motors Bags $10.85 Mn Funding From True Ventures, Others appeared first on Inc42 Media.

Chinese automaker BYD has reportedly proposed to invest $1 Bn in India to manufacture electric cars and batteries in the country. 

The Chinese company has reportedly sent a proposal, in partnership with Hyderabad-based manufacturer Megha Engineering and Infrastructures, to the regulators for the same, Reuters reported.

In the long-term, BYD plans to launch a full-range of its vehicles in India, ranging from hatchbacks to luxury models.

BYD aims to produce 100,000 EVs in India annually in a few years, but it would begin with shipping vehicle parts for assembly across the country through its own supply chain. 

Besides, BYD and Megha Engineering also plan to launch charging stations in India and build research and development and training centres, the report said.

The development comes a day after it was reported that BYD’s rival Tesla is mulling moving its auto and electronics supply chain to India.

However, it remains to be seen if BYD’s proposal gets the nod from Indian regulators. India has tightened norms for Chinese investments since the clash between the armies of both the countries in 2020. This also resulted in China’s Great Wall Motor shelving its plans to invest $1 Bn in Indian

Over the last few years, India has emerged as an attractive destination for companies trying to shift a part of their production outside China to reduce their reliance on the country. A number of Apple suppliers and manufacturers have moved production to India over the last couple of years. Tech giant Google is also mulling manufacturing Pixel smartphones in India.

Besides, India is also a large and growing automotive market, making it attractive for companies like BYD. While the penetration of electric car sales in the total car sales in the country is just about 1%, this number is expected to grow in the future.

The post China’s BYD Proposes $1 Bn Investment In India To Build Electric Cars, Batteries appeared first on Inc42 Media.

Industry body Society of Manufacturers of Electric Vehicles (SMEV), a harsh critic of the Centre’s FAME-II policy, on Thursday (July 6) said it is temporarily suspending its constitution. 

In a statement, the SMEV said it is going into hibernation and has appointed former Bharatiya Janata Party spokesperson Sanjay Kaul as ‘Chief Evangelist’ to revise the agenda of the association for the EV sector.

“We have requested Mr Kaul to help revise the agenda of the association for the sector and develop a new charter that aims to lift the industry from the situation it finds itself in right now. His experience in working with different groups, and his ability to forge consensus and his insight into the industry will be sought to help fashion a new direction for the association in relation to the EV sector,” said Ajay Sharma, secretary general of SMEV, said.

It is pertinent to note that the government’s probe into multiple electric two-wheeler manufacturers for misappropriating FAME-II subsidies and subsequent cut in the subsidies have hit India’s electric vehicle (EV) industry hard. The SMEV has been a vocal critic of these developments.

Last month, the industry body wrote to government think tank NITI Aayog saying the “detrimental actions” of the Centre since last year have “contaminated” the national emobility charter. 

The “triple whammy” of subsidy blockade, claw back notices and embargo on future sales are sabotaging the FAME II policy, it said, adding that the scheme has failed to achieve even 50% of its target since its launch in 2019.

Recently, the SMEV also wrote to Minister of Commerce and Industry Piyush Goyal, seeking ‘contingency support’ for the EV industry. It said the unpaid FAME-II subsidy dues of INR 1,200 Cr since last fiscal and several other issues have created a crisis for the industry.

Earlier, the SMEV criticised the Ministry of Heavy Industries (MHI) for gaps in its accounting of subsidies. It said that while 9.6 Lakh two-wheeler EVs were sold under the FAME-II scheme during April 2019 to April 2023 period, the OEMs had not received reimbursements for 4.5 Lakh vehicles. 

“This means that only around 5 Lakh EVs have been funded under the scheme, about 50% of the target,” the industry body had said.

Speaking on the rejig in the association, Sohinder Gill, DG of SMEV, said, “The SMEV has been proactive on issues concerning EV adoption and has partnered with the government’s efforts since inception and even before the FAME policy was initiated.”

Given the EV sector is under extreme stress currently, the SMEV is willing to work with all stakeholders to seek a way out, he added.

The SMEV has suspended all operational actions until a new structure is fashioned under the guidance of Kaul, informed the association. 

“We need to resolve the minor issues and move on to deploying the spate of investments coming India’s way in this sector,” said Kaul.

Meanwhile, following its probes finding misappropriation of subsidies by several electric two-wheeler manufacturers, the MHI recently slashed incentives under the FAME-II scheme to 15% of ex-factory price from 40% earlier and cut the demand incentive to INR 10,000/kWh from INR 15,000/kWh.

Consequently, OEMs increased their vehicle prices, which, in turn, hit demand. As per Vahan data, total electric two-wheeler registration in the country dropped to a 12-month low to 45,841 units in June from a whooping 1,05,374 in May this year.

The post Amid FAME-II Troubles, SMEV Suspends Constitution & Goes Into Voluntary ‘Hibernation’ appeared first on Inc42 Media.

Following the FAME-II fiasco, electric two-wheeler registrations in the country nosedived to a 12-month low in June by falling 56% month-on-month (MoM) to 45,734 units.

After touching a record high of over 1 Lakh registrations in May this year, two-wheeler EV registrations in June 2023 fell to a level last seen in June 2022. The number of two-wheeler EV registrations stood at 44,383 units in the year-ago month. 

A majority of escooter OEMs, including Ola Electric, Ather Energy, TVS Motor, Hero Electric, Okinawa Autotech, and Hero MotoCorp, witnessed a significant slump in registrations in June 2023. However, Ola Electric continued to lead the race with total escooter registrations of 17,552 units, as per data available on the Vahan portal on July 1.

Despite the Bhavish Aggarwal-led electric mobility major retaining its top spot, its EV registrations fell over 38% MoM from 28,629 units in May, reversing the sharp upward trend of the past three three months.

On the other hand, Ather Energy’s escooter registrations plunged 70.5% to 4,540 units in June from 15,407 units in May. June 2023 was also the worst month for Ather Energy since June and July last year, when its registration volume stood at 1,289 and 5,377 units, respectively.

As per a statement by Ather Energy, the startup sold 6,479 units in June this year. 

TVS Motor’s vehicle registration also slumped to 7,791 units last month from 20,398 units in May. However, it retained its second spot on the list in terms of two-wheeler EV registrations. 

It is pertinent to note that Ola Electric, TVS Motor, and Ather Energy have been leading the sales of escooters in India since the beginning of this year. However, these three OEMs also came under the government’s scanner for keeping their vehicle prices artificially low to claim the benefits of FAME-II subsidy.

After an investigation into the matter, these players, along with Hero MotoCorp, were asked to reimburse the excess monies paid by their customers for buying the charges and software separately. Together, the four players agreed to refund about INR 288 Cr to their customers.

Amid this, the government also slashed the incentives for electric two-wheelers under the FAME-II scheme to 15% of ex-factory price from 40% earlier and cut the demand incentive to INR 10,000/kWh from INR 15,000/kWh.

Following this, most of the EV players increased their vehicle prices. Ola Electric increased the prices of its S1 and S1 Pro escooter models by INR 15,000 each from June 1. Ather increased the price of its 450X escooter model by around INR 30,000, while TVS Motor also hiked the price for its iQube and iQube S escooters.

Besides, OEMs including River, Matter,  and AMO Mobility also increased their escooter prices.

“The drop in numbers was expected, given the recent price increase on account of the lower FAME subsidy and consumers bringing their purchases forward into May. While the drop was slightly more than we’d anticipated, we remain optimistic about an industry bounce-back over the next 2-3 months,” said Ravneet Singh Phokela, chief business officer at Ather Energy.

“We have always been of the view that the subsidy should be phased off gradually over time so that consumers can adjust to more realistic market prices. While it impacts short-term financials, this is certainly a step in the right direction from a long-term perspective,” Phokela added.

It must also be noted that more than a dozen two-wheeler EV players, including Okinawa Autotech, Hero Electric, Jitendra EV, Greaves Electric Mobility, and Revolt, were also investigated by the government for allegedly violating localisation norms to get the subsidies under FAME-II.

The investigation and the subsequent changes made by the government impacted most of these OEMs. 

Okinawa’s EV registrations dropped 10% MoM to 2,615 units in June 2023, while Ampere’s escooter registration volume dropped 84% MoM to 1,601 units. Bajaj Auto also saw a 70% decline in registrations to 2,966 units in June.

EV registrations of Lectix EV, which recently began witnessing some volume growth and saw a record registration of 1,000 vehicles in May, also fell 88% MoM to 115 units in June. However, Revolt and Pure EV were among the two leading names that saw an increase in their vehicle registrations. 

Meanwhile, Simple Energy also began delivering its EVs last month and saw registration of 10 units in June.

The decline in two-wheeler EV registrations in June 2023 didn’t come as a shock as the industry was anticipating an adverse impact from the changes in FAME-II norms. 

Last month, industry body Society of Manufacturers of Electric Vehicles (SMEV) wrote to Minister of Commerce and Industry Piyush Goyal, seeking ‘contingency support’ for the industry saying that the situation was near ‘breaking point’.

Total EV registration across vehicle categories fell over 35% MoM to 1,01,832 units in June but was up 34.2% YoY.

The post Two-Wheeler EV Registrations Hit A 12-Month Low At 45,734 Units In June appeared first on Inc42 Media.

Nearly 9,000 petrol pumps in India now provide electric vehicle (EV) charging facilities, according to data from the Ministry of Petroleum and Natural Gas.

As per The Economic Times quoting official figures, the number of fueling stations offering electric charging facilities has risen significantly from 3,423 in 2022 to 8,853 at the beginning of June. This number accounted for nearly 10% of the total petrol pumps in the country. 

Indian Oil Corporation, the largest petrol pump operator in the country, leads in providing EV charging facilities, at nearly 5,600 of its 36,400 outlets, accounting for 15% of the total. Hindustan Petroleum Corporation (HPCL), the second-largest operator, has charging facilities at its 2,100 pumps, while BPCL offers EV charging at 738 pumps.

On the other hand, private fuel retailers, including Reliance-BP, Nayara Energy, and Shell, have also begun transitioning to green energy, albeit on a smaller scale. Reliance-BP has an EV charging facility at 28 out of its 1,586 pumps while Nayara Energy offers the service at 178 out of 6,388 pumps. Shell has also rolled out the offering at 201 out of 343 pumps.

In total, private retailers offered the EV charging option at 407 pumps across the country.

Meanwhile, as per the report, oil public sector undertakings (PSUs) such as Indian Oil, HPCL, and BPCL plan to expand EV charging facilities to a combined total of 22,000 pumps in the coming years. While Indian Oil is targeting rolling out the service at 10,000 pumps by 2024, HPCL is eyeing setting up 5,000 EV stations at its pumps by 2025.

The push comes at a time when the general Indian public transitions to EVs as a mode of transport. Although the current number of EVs in the country is still small, the rapid adoption of such vehicles could increase the demand for public charging infrastructure. 

Increasing the number of charging facilities in cities and along highways will alleviate concerns about limited driving range, thus encouraging more people to transition to electric vehicles and accelerating the overall shift towards electrification, an official told ET.

Meanwhile, the government has announced a slew of initiatives to push the homegrown EV space and to spur the related infrastructure related to the ecosystem. In the past, the centre launched the, now mired in controversy, FAME-II  scheme and followed it up with a production linked incentive to incentivise local manufacturing of EVs. 

Last month, the government announced its plan to develop a master app to track real-time availability of slots at EV charging stations. On the private side, many global giants including the likes of Foxconn have expressed interest in manufacturing EV components in India. 

The post Nearly 9,000 Petrol Pumps In India Offer EV Charging Facility: Govt Data appeared first on Inc42 Media.

The global shift to electric vehicles (EVs) has gained traction in recent years, fueled by the need to reduce carbon emissions and combat climate change. As governments around the world prioritise the transition to sustainable transportation, the demand for accessible and flexible financing options for EV purchases grows. 

However, one of the major barriers to widespread adoption is the higher initial cost of EVs when compared to conventional vehicles. To address this challenge, industry players are coming together to develop comprehensive financing solutions that address affordability concerns and accelerate EV adoption.

OEMs, dealerships and financial institutions are working together to develop collaborative approaches to EV financing. By leveraging their respective expertise and resources, these stakeholders are working towards making EVs more affordable and accessible to consumers. 

Let’s take a look at the latest trends and initiatives in collaborative EV financing, highlighting the benefits and implications for all involved parties.

OEMs Are Taking The Lead

Many OEMs are taking proactive steps to facilitate EV adoption, recognising the importance of affordable financing options. They are partnering with financial institutions to provide attractive loan terms, lower interest rates, and flexible payment plans specifically tailored for EV purchases. 

Moreover, some OEMs have established in-house financing divisions to offer their customers more streamlined and competitive financing options. This collaborative approach helps OEMs strengthen their brand loyalty, increase sales volumes, and accelerate the transition to electric mobility.

Dealerships: The Gateway To Affordable EV Financing

Dealerships play a crucial role in bridging the gap between OEMs and consumers. They have direct access to potential EV buyers and are well-versed in local financing options. They are implementing innovative strategies to educate customers about the financial benefits of owning an EV in collaboration with OEMs and financial institutions. 

They are offering comprehensive financing packages that include incentives, tax credits, and subsidies to lower the overall cost of ownership. By providing a seamless and hassle-free purchasing experience, dealerships are pivotal in driving EV adoption.

Financial Institutions: Pioneering Green Financing

Financial institutions are recognising the growing EV market’s potential and are actively participating in collaborative financing initiatives. Many banks and lending institutions are developing specialised electric vehicle financing programmes with favourable terms and conditions. They are also incorporating sustainability criteria into their lending policies, giving preference to customers opting for eco-friendly vehicles. 

Furthermore, partnerships between financial institutions and OEMs allow for faster credit approvals, resulting in a more efficient and accessible financing process. By embracing green financing, financial institutions can attract environmentally conscious consumers and contribute to a sustainable future.

Synergies And Benefits

The collaborative approach to EV financing provides several advantages to all stakeholders. OEMs can increase their market share, strengthen customer loyalty, and achieve sustainability goals by encouraging the adoption of EVs. Dealerships can diversify their product offerings, attract new customers, and establish themselves as trusted EV advisors in their communities. 

Financial institutions can tap into a lucrative market segment, enhance their green credentials, and forge long-term relationships with customers. Most importantly, consumers benefit from affordable financing options, reduced operating costs, and a significant contribution towards a cleaner and greener environment.

Conclusion 

The collaborative approach to EV financing is a powerful catalyst for accelerating the global transition to electric mobility. By pooling their expertise and resources, the stakeholders can overcome the financial barriers associated with EV adoption. 

As more OEMs, dealerships, and financial institutions embrace this collaborative model, we can expect to witness a surge in EV sales, a decline in carbon emissions, and a more sustainable future for generations to come. It is through such collaborative efforts that we can collectively drive the growth of electric vehicles and pave the way for a cleaner, greener transportation ecosystem.

The post How Collaborative EV Financing Can Unlock Widespread Adoption & Affordability appeared first on Inc42 Media.

Punjab’s transport minister Laljit Singh Bhullar reportedly said that the state government will provide around INR 300 Cr worth of incentives over the next three years to promote the adoption of electric vehicles (EVs).

As per a PTI report, the state government will provide incentives to electric two-wheelers, electric rickshaws, electric autos, electric cycles, and electric light commercial vehicles (LCVs).

He made the announcement on Wednesday (June 21) while presiding over a meeting of the state-level EV committee, which looks after the implementation of the state’s EV policy. 

Bhullar also directed the officials of the transport department to write a letter to the finance department to create a dedicated EV fund to facilitate their adoption. 

Citing an official statement, the report said Bhullar also took details of all the responsibilities entrusted to various departments that would work on the implementation of the EV policy.

Bhullar instructed the Punjab State Power Corporation Ltd and Punjab Energy Development Agency officials to prepare a report within a month for setting up EV charging stations and identify suitable sites for the same.

He also asked the Housing and Urban Department officials to formulate a policy for ensuring that EV charging facilities are set up in upcoming malls and housing societies in the state.

He also called for expediting the process of scrapping government buses older than 15 years and replacing them with ebuses.

Punjab’s EV Policy

In a push to ensure EV adoption in the state, Punjab rolled out Electric Vehicle Policy, 2022 in February this year. Under the policy, the state government aims to incentivise the first 1 Lakh EVs registered in the state. These vehicles will get an incentive of up to INR 10,000.

It aims to provide incentives of up to INR 30,000 to first 10,000 electric autorickshaws and erickshaws and 5,000 ecar buyers. Besides, incentives of up to INR 30,000-INR 50,000 will also be provided to the first 5,000 LCVs. The policy would be valid for three years.

The state government came out with the EV policy at a time when more and more state governments are doing so in a bid to facilitate the use of EVs. Last year, the governments of Chhattisgarh, Haryana, and Maharashtra also announced their respective incentivisation plans for EVs.

However, EV adoption in Punjab remains significantly lower than states such as Uttar Pradesh, Haryana, and Delhi.

As per Vahan data, Punjab saw registrations of 14,055 EVs in 2022, while the number stood at 1,62,857 units in Uttar Pradesh. In Haryana, there were registrations of 25,861 EVs last year and the number stood at 62,266 units for Delhi. 

Even in 2023, Punjab’s EV registrations stand at only 9,908 units so far, which is lower than not only its neighbouring states but also the likes of Chhattisgarh, Bihar, Assam, Odisha, Kerala and Tamil Nadu.

As per the Centre’s data provided in early March this year, the total EV count in Punjab stood at 25,597 as against 1.3 Cr of total vehicles across fuel types.

The post Punjab To Provide INR 300 Cr Incentives To Promote EV Adoption appeared first on Inc42 Media.

Industry body Society of Manufacturers of Electric Vehicles (SMEV) on Monday (June 19) wrote to Minister of Commerce and Industry Piyush Goyal seeking ‘contingency support’ for the electric vehicle (EV) industry, which, it said, has been hit hard by the issues with the FAME-II scheme.

The SMEV, in its letter to Goyal, said that unpaid FAME-II subsidy dues of INR 1,200 Cr since the last fiscal, an embargo on original equipment manufacturers (OEMs) from listing their sales on the official National Automotive Board (NAB) portal, and notices to recover past paid subsidies have created a crisis for the industry. The situation is near ‘breaking point’, it added.

The development comes days after the SMEV wrote a similar letter to the government think tank NITI Aayog calling the past one year’s regulatory actions by the Ministry of Heavy Industries (MHI) on the electric two-wheeler players “detrimental”. The industry body also said that the ministry’s actions have “contaminated” the national emobility charter.

In its latest letter to Goyal, the SMEV said, “You will appreciate that this triple whammy is unprecedented in the annals of business in the country and that nowhere in the world do we see this kind of vindictive actions against the very companies that pioneered the EV revolution in the country – at a time when there was no government support to the sector at all.”

“The absolute unreasonable situation, coupled with a cavalier attitude towards the financial condition of these companies has required us to seek your support as the Hon’ble Minister of Commerce and Industry who might understand the business cycle, the production and process of industrial units, the financial cycle and what impact it has on business when the cycle stops,” it added.

Further, the SMEV also said that the regulatory uncertainties have impacted homegrown EV startups that were fuelled by the government’s zeal towards ‘Make in India’ and ‘Start-Up India’ initiatives.

It must be noted that while the SMEV has been claiming that the issues have affected the EV sector, the government’s action came after it found many of the OEMs violating FAME-II norms. Hero Electric, Okinawa Autotech, Revolt, Ampere, and several others were probed for allegedly flouting minimum localisation norms of the FAME-II scheme. Later, Ola Electric, Ather Energy, TVS Motor, and Hero MotoCorp were probed for mispricing the vehicles and later, they agreed to refund crores of rupees to their customers.

While the issues with the FAME-II scheme affected the sale of two-wheeler EV manufacturers over the last few months, the recent FAME-II subsidy cut by the government and the subsequent increase in vehicle prices by several manufacturers is expected to further dent their vehicle registrations. 

The electric two-wheeler registrations in India crossed the 1 Lakh mark for the first time in May. The number stands at 19,645 units till June 19, as per Vahan data, which is not even 20% of last month’s sales. 

Vehicle registrations for Ola Electric, which stood at 28,500 units last month, stand at 8,059 units so far in June. On the other hand, TVS Motor’s vehicle registrations stand at 1,809 units so far this month as against 20,379 units in May. 

Commenting on the decline in registrations, Sohinder Gill, director general of SMEV, said, “It will be to nobody’s credit if these EV companies fail or are sold for a song to the highest bidder. It will be a black mark against Indian enterprise and the burgeoning emobility plans of the government. It is important to note that investors across the world are watching this space closely, and banks and financiers are refusing to extend credit.”

The post FAME-II Issues: SMEV Seeks Commerce Ministry’s Support, Says EV Sector Near ‘Breaking Point’ appeared first on Inc42 Media.

In recent years, India’s journey towards embracing electric vehicles (EVs) has seen significant progress, fueled by rising pollution concerns, rising fuel prices and a growing demand for sustainable transportation solutions. 

Grappling with the challenges posed by climate change, the Indian government launched the Faster Adoption and Manufacturing of Electric Vehicles II (FAME II) scheme in 2019, aiming to accelerate the adoption of EVs and position India as a global leader in clean and green mobility. However, the recent decision to slash the FAME II subsidy has raised concerns about the impact it may have on India’s developing EV industry. 

A Step Backward For The EV Industry

The reduction in the FAME II subsidy comes at a critical juncture in India’s EV industry, which is still in its early stages. While the FAME II scheme was initially viewed as a significant boost, the abrupt reduction in subsidies sends mixed signals to the industry and undermines investor trust. 

It also creates uncertainty among manufacturers, making it difficult for them to plan and execute long-term EV manufacturing strategies. With reduced financial incentives, the cost of EVs becomes less competitive, making it difficult for widespread adoption among Indian customers. 

Affordability is one of the primary drivers of EVs’ success. By lowering the subsidy under FAME II, EVs become more expensive for consumers. As a price-sensitive market, India relies heavily on government subsidies to bridge the cost gap between EVs and conventional vehicles. Slashing the subsidy abruptly and unexpectedly may result in a significant drop in demand, stifling the EV market’s growth. This action may deter potential buyers from seeing EVs as a viable alternative, leading to a blow to India’s ambitious electrical mobility goals.

The Indian EV industry relies heavily on economies of scale to reduce production costs. Manufacturers invest in building robust supply chains, EV battery manufacturing facilities, and research and development to foster innovation and achieve cost efficiency. Lowering the subsidy will not only affect customer demand but also hamper manufacturers’ ability to scale up production. This may hinder domestic and international manufacturers from establishing or expanding operations in India, jeopardising India’s vision of becoming a worldwide EV manufacturing hub.

Another critical aspect for the success of any sector or industry, especially sunrise sectors like EVs, is a stable and predictable policy environment. The sudden cut in the FAME II subsidy creates an atmosphere of uncertainty that may discourage investment in the electric vehicle sector. To make informed decisions about capital allocation and resource planning, manufacturers and investors need stability and consistent policies. But frequent fluctuations in policies can lead to confusion, hamper growth and harm the electric vehicle industry’s ability to conduct business.

Need For A Comprehensive Approach

The government should put more effort into establishing a comprehensive strategy to support the expansion of the EV industry rather than cutting subsidies. 

This could include a combination of measures such as increasing R&D spending, encouraging indigenous battery manufacturing, putting in place battery charging infrastructure and creating incentives for customers and manufacturers. Furthermore, facilitating collaborations between industry, research institutions, and academia can also drive innovation in the EV market. 

India’s nascent EV industry holds enormous potential to promote sustainable transportation, reduce carbon emissions and generate employment. However, while the Indian government’s decision to reduce FAME II subsidies aims to strike a balance between fiscal constraints and encouraging innovation, it risks stalling the growth of India’s thriving electric vehicle industry. 

The abrupt withdrawal of incentives might limit the adoption of EVs, hinder domestic manufacturing, discourage potential buyers and undermine the growth of the EV market. Therefore, a phased reduction in subsidies and a gradual transition to market-based mechanisms could have been a more prudent approach than an outright cut.

To achieve India’s ambitious electrification targets, the government must embrace a long-term vision, implement consistent regulations and establish a comprehensive framework that promotes the adoption and manufacturing of electric vehicles. Only with a sustained and supportive policy ecosystem can India’s nascent EV boom become a reality and drive a cleaner and greener future for the country.

The post FAME II Subsidy Shake-Up: Will It Put Brakes On India’s EV Revolution? appeared first on Inc42 Media.

Amid the ongoing issues with FAME-II, including probe against original equipment manufacturers (OEMs) and slashing of subsidies, industry body Society of Manufacturers of Electric Vehicles (SMEV) said that the “detrimental actions” of the Centre over the last year or so have “contaminated” the national emobility charter.

In a letter to government think tank NITI Aayog, the SMEV said that the FAME-II fiasco has resulted in a complete regression of the objectives of the mobility charter and adversely impacted the electric vehicle (EV) industry.

“The Ministry of Heavy Industries’ (MHI) actions over the past 18 months i.e., withholding subsidies, demanding retrospective claw backs of subsidy given in 2019, delisting companies from NAB (National Automotive Board) portal and now its latest move to slash subsidies, is likely to impact sales and substantially delay the process of EV adoption and penetration in the country,” the industry body said and asked NITI Aayog to review the FAME-II policy.

It is pertinent to note that issues around the FAME-II policy started around August last year when the MHI started focussing on domestic manufacturing of components used in EVs and domestic value addition. 

First, Hero Electric and Okinawa Autotech came under the government’s scanner for allegedly flouting minimum localisation norms of the FAME-II scheme. Subsequently, a probe was also started against several other players, including Revolt and Ampere Vehicles. 

While this probe was ongoing, Ola Electric, Ather Energy, TVS, and Hero MotoCorp were alleged to have kept their vehicle prices artificially lower to claim FAME-II subsidies. Subsequently, these companies agreed to refund the customers.

Launched in 2019 with a total outlay of INR 10,000 Cr, the FAME-II scheme aims to support 10 Lakh electric two-wheelers, 5 Lakh electric three-wheelers, 7,000 ebuses, and 55,000 electric four-wheeler passenger cars through subsidies. 

Earlier, electric two-wheelers were to get a maximum subsidy of 40% on the total cost of the vehicles under FAME-II if their maximum ex-factory price was INR 1.5 Lakh per unit. However, after finding misappropriation of FAME-II subsidies by EV players, the government recently slashed the incentives to 15% of the ex-factory price of electric two-wheelers from 40% earlier. It also cut the demand incentive to INR 10,000/kWh from INR 15,000/kWh earlier.

“The triple whammy of subsidy blockade, claw back notices and embargo on future sales are sabotaging the FAME II policy. It is evident that the emobility ambitions of the country have been impacted as the scheme could not make-up even 50% of its mandated target over 5 years, since 2019,” Sohinder Singh Gill, DG of SMEV, said in the letter. 

Gill is also the CEO of Hero Electric.

‘FAME-II An Elitist Program Now’

Gill also said that the issues with the scheme and the deviation from the vision of NITI Aayog raises questions about the intended mass movement that was envisioned for emobility. He claimed that low-end commuter scooters are losing out to the premium segment due to these issues. 

“In a contrarian effect, not seen elsewhere, the FAME scheme has spawned a spurt in the premium EV bikes at the cost of commuter scooters,” he added.

It must be noted that despite the issues around FAME-II, premium players like Ola Electric and Ather Energy have continued to gain more market share.

The electric two-wheeler registrations crossed the 1 Lakh mark for the first time last month, led by the growing sales of Ola Electric, Ather Energy, and TVS Motors. Meanwhile, players like Hero Electric and Okinawa Autotech, which largely sell commuter scooters and low-range bikes, have witnessed a declining trend over the past few months.

The SMEV called the current state of affairs a “corrosive transformation into an elitist program”, which neglects the principles of inclusivity and accessibility. 

“It is disheartening to witness how these policy initiatives have transformed from a progressive and inclusive movement into an elitist pitch, deviating from the very essence of Niti Aayog’s prescriptions,” the industry body said.

A Full-Scale Meltdown Ahead For EV Players?

Earlier, in April, the SMEV wrote to the government saying that two-wheeler EV makers did not receive subsidies for 4.5 Lakh vehicles out of the 9.6 Lakh vehicles that the government claimed to have been supported under FAME-II.

Highlighting the adverse impact of the FAME-II conundrum on the EV industry, the SMEV, in the latest letter, said, “The OEMs are struggling to stay afloat; investors are wary; banks are withdrawing; employees are fleeing; debts are rising, and closures are the next imminent step.”

It must be noted that following the recent cut in FAME-II subsidies, several EV players, including Ather Energy, Ola Electric, AMO Mobility, River, and Matter, have raised their vehicle prices.

However, Hero Electric has not raised the prices of its escooters. Speaking to Inc42, Gill said that unlike the customers of these premium players, Hero Electric caters to the low-budget commuter segment. Hence, it cannot give such a shock to its customers.

Although premium escooters and ebike segments are seeing a steady growth, the price rise could dampen the demand in the near-term in these segments as well. For instance, Ola Electric’s vehicle registrations in the month of June stood at 6,564 units as of Friday (June 16), as per Vahan data. This is not even 25% of the startups’ total vehicle registrations in May. The Bhavish Aggarwal-led startup saw registrations of 28,563 units last month.

Similarly, Ather Energy’s total vehicle registrations stood at a mere 1,417 units till June 16. In May, the company saw total vehicle registrations of 15,384 units.

What’s Next For FAME?

Amid the hiccups with FAME-II, the EV industry has been demanding an extension of the scheme, which is currently scheduled to end on March 31, 2024. Recently, a parliamentary committee on EVs also recommended extension of the scheme.

However, sources told Inc42 that while there are no plans to extend the FAME-II scheme, the Centre may come out with a new version of the scheme, FAME-III.

The government has not taken a final call on the issue and is currently seeking suggestions and views from the industry.

Commenting on the need for FAME-III, Sushant Kumar, founder and MD of AMO Mobility, said it will be essential to boost India’s EV ecosystem and promote the adoption of EVs. 

If the FAME-III policy is rolled out, it should make the consumers the direct beneficiary rather than them being one of the many players benefitting. Putting consumers as key entities in the EV ecosystem will help implement the policy productively and sustainably, he added.

Echoing similar sentiment, Jayapradeep V, chief business officer at Raptee, said, “The sudden reduction of FAME-II to 15% has just started impacting the EV industry at the moment. Therefore, to ensure faster adoption of EVs by 2030 by continuing the momentum, customer-side incentives from the government are very critical and will be a deal maker/breaker for the industry.” 

Increase in EV adoption on the back of government subsidies would lead to improvement in volumes which would help OEMs in cost optimisation, thereby further improving adoption, he added.

However, Gill doesn’t have high hopes from FAME-III. He said even if the government comes out with FAME-III, the subsidies are likely to be trimmed further from the existing level. 

As such, industry players should buckle up and rely less on government support and more on a robust business model, he added.

The post FAME-II Hiccups Have Hit India’s Emobility Ambitions, Policy Needs To Be Reviewed: SMEV appeared first on Inc42 Media.

Li-ion cells are powering the world’s transition to EVs, and all countries, including India, are competing fiercely to reap maximum benefits from this transition by localising the supply chain. Today, 70% of India’s cell import share relies on neighbouring countries, posing a high risk as geopolitical tensions can impact business growth, making localisation even more necessary.

The Indian Li-ion battery market is anticipated to grow from 4 GWh in 2022 to 120 GWh by 2030. To keep up with demand growing at a 53% CAGR (from 2022 to 2030), cell manufacturers have to innovate and scale up at breakneck speeds. While talks on localisation have paved the way in the past year through the government-led PLI scheme and potential JV announcements, it is pertinent to look at the challenges holding back domestic cell manufacturing capabilities.

R&D Know-How

Li-ion technology is a niche segment that requires an extensive R&D skill set and expertise, which India currently lacks. While a few countries have taken steps to strengthen the R&D sector by funding home-grown solutions, India has yet to foster a competent R&D knowledge base.

Leading industry players and deeptech startups with indigenous R&D are bringing global technical expertise to India through JVs. But the need of the hour is a centre of excellence to bring in battery experts, EV veterans and policymakers from industry and government under one umbrella to avoid re-inventing the wheel and direct the collective efforts towards the indigenisation of cell manufacturing.

Talent Deficit

The Li-ion industry needs technical expertise across different domains and hierarchies. According to estimates, a 130-140 highly skilled workforce is required per GWh capacity, and despite having the world’s largest youth population with more than 1.5 Mn engineers and 24K doctorates graduating each year, India still has a talent deficit in the Li-ion cell industry. 

Meeting such high workforce demand is challenging for companies and hence, apart from business objectives, the industry needs to invest in people development and leverage under-utilised talents, which would in turn help strengthen the talent pipeline. 

Enabling A Resilient Supply Chain

A seamless supply of battery raw materials is critical to establishing a resilient end-to-end supply chain for Li-ion cell manufacturing. Through 2030, all aspects of the battery value chain are expected to witness revenue growth of 25-35% CAGR, indicating the importance of investments in upstream sectors. 

While India’s recent discovery of 5.9 Mn tonnes of lithium reserves is a boon, it could take around 7-8 years to bring the mine to commercial production levels. To help localise long-term demand, India can implement a policy similar to the European Green Deal, in which equipment manufacturers have access to an innovation fund to expand their capabilities.

Energy Supply To Meet Demand Spike

Gigafactories are highly automated and run under controlled conditions, demanding high utilities. One GWh of cell production needs around 50-65 GWh of energy, which might in turn be a significant addition to India’s energy supply as rural areas still lack 24×7 access to electricity. 

Geopolitical tension and climate change also put significant pressure on energy demand and supply, thereby requiring strong strategic initiatives and pivoting towards renewable energy to secure future supplies. While MNRE aims to install and commission 450 GW of renewable energy by 2030, the energy demand spike may outpace the renewable energy installations and thus, again rely largely on coal.

Capex & Opex

Currently, global manufacturers spend $70-90 Mn/GWh to set up manufacturing facilities. ICRA estimates that achieving 60GWh cell manufacturing capacity in India will require an investment of $9 Bn or more over the next decade. 

The low EV penetration in India, combined with the uncertainty of demand, creates a significant barrier to capital investment. Global players are announcing investments in leading regulatory markets such as the EU and North America, but none in India so far. Localising the supply chain would lower operating expenses, easing the capital-intensive nature of cell manufacturing.

Government Incentives 

The US government’s $270 Bn IRA scheme, which could reduce battery costs by up to $45/kWh, has enticed global manufacturers to accelerate investment in the US. India’s INR 18,000 Cr PLI scheme was the first of its kind, but benefits were limited to a select few. 

While steps such as lowering import duties on capital goods and cell manufacturing equipment to 0% are encouraging, a comprehensive scheme that encompasses the entire battery value chain would provide the much-needed push. For instance, a rule similar to the UK’s ‘country of origin; laws, which require a minimum of 65% of cell components to be of UK/EU origin by 2027, could be considered for the Indian context.

In A Nutshell   

To summarise, the challenges listed above can be tackled and addressed strategically through M&As, JVs and technical interventions, among others. The biggest benefit of cell manufacturing in India is avoiding the adverse effects of geopolitical events. 

Deeptech companies and other leading industry players are already pacing up to manufacture li-ion cells indigenously and the industry has all eyes on the government to roll out new policies and incentives to facilitate setting up manufacturing facilities. Self-reliance and indigenisation will lay the foundation for India’s dream of becoming energy independent.

The post Building A Resilient Supply Chain: How EV Startups Can Boost Domestic Li-ion Cell Manufacturing  appeared first on Inc42 Media.

Lean manufacturing principles can play a crucial role in the electric vehicle (EV) industry in India. The application of lean manufacturing can enhance operational efficiency, reduce waste, and improve overall productivity in EV manufacturing plants. 

Lean manufacturing is an approach that focuses on maximising efficiency, reducing waste and optimising processes within a manufacturing system. It has gained significant importance in the EV industry worldwide, including in India. 

The Indian EV industry is rapidly growing, and implementing lean manufacturing principles can help enhance productivity, quality and competitiveness. Here are some key areas where lean principles can be beneficial in the EV industry:

Value Stream Mapping (VSM)

VSM helps identify and eliminate non-value-added activities, reducing waste and improving process flow. By implementing VSM in EV manufacturing, companies can streamline their production processes, optimise material flow and eliminate bottlenecks, resulting in increased productivity and reduced lead times. 

Work-in-process (WIP) limits on the Kanban board help the team manage capacity. With this information, it’s now quite easy to see and eliminate normal sources of process waste, returning focus to the customer.

Just-in-Time (JIT) Production 

JIT is a core principle of lean manufacturing that aims to eliminate waste by producing and delivering components or materials just when they are needed in the production process. 

JIT can help EV manufacturers reduce inventory costs, minimise storage space requirements and improve cash flow by avoiding excess inventory.

Standardised Work

Implementing standardised work processes ensures consistency, reduces errors and facilitates continuous improvement. 

In the EV industry, standardised work can be applied to assembly lines, quality control processes and maintenance activities, leading to improved efficiency and product quality.

Error-proofing (Poka-Yoke) 

Error-proofing techniques, also known as poka-yoke, involve designing processes and systems in a way that prevents or detects errors before they occur or reach the customer. Implementing such measures can significantly reduce defects, rework, and warranty costs.

Continuous Improvement (Kaizen)

Encouraging a culture of continuous improvement is essential in the EV industry to identify and eliminate waste, inefficiencies and defects. 

By implementing Kaizen practices such as employee involvement, problem-solving techniques and regular process audits, EV manufacturers can drive innovation, increase productivity and enhance overall product quality.

Total Productive Maintenance (TPM) 

TPM focuses on equipment reliability and aims to minimise equipment downtime, defects and breakdowns. 

In the EV industry, implementing TPM practices can help ensure the maximum availability of manufacturing equipment, reduce maintenance costs and optimise production output.

Employee Involvement & Training 

Engaging and empowering employees is vital for lean manufacturing success. 

Providing training and involving employees in process improvement initiatives can lead to increased motivation, innovation and a greater sense of ownership in the workforce. Companies can establish cross-functional teams or suggestion systems to encourage employee involvement in problem-solving and waste-reduction efforts.

Pull System

The pull system flips the script by emphasising and assisting coworkers in completing current tasks before beginning new ones. 

Throughout the process, when one piece is done, workers notify one another, and the next person can work on the project as soon as their available capacity allows. As a result, morale, productivity and efficiency get a boost. 

Supplier Collaboration 

Lean principles extend beyond the manufacturing facility to the entire supply chain. 

Collaborating closely with suppliers can help streamline inbound logistics, reduce lead times, improve quality control and ensure timely delivery of components, enhancing overall efficiency in the EV manufacturing process.

Bottom Line

Lean manufacturing brings you closer to your customers because they become your top priority. Visualise what could help your team become more systematic and put lean systems in place to find success. 

By implementing lean manufacturing principles, the EV industry in India can achieve cost savings, improved quality, increased productivity and a more sustainable production process. It is important for companies to assess their specific manufacturing processes, identify areas for improvement and tailor lean practices accordingly to maximise their benefits in the context of the EV industry.

The post How Lean Manufacturing Can Boost Productivity & Quality In India’s EV Sector appeared first on Inc42 Media.

Electric two-wheeler registrations crossed the 1 Lakh mark for the first time in May, despite the problems around the FAME-II subsidy due to allegations of misappropriation against certain manufacturers. 

Total vehicle registration in the category jumped 57% to 1,04,771 units in May from 86,259 in April, as per data available on the Vahan portal on June 1. Ola Electric continued to lead the pack, followed by TVS Motor and Ather Energy.

Ola Electric saw a record 28,438 registration last month, a rise of over 29% from 21,991 units in April.

It must be noted that the Bhavish Aggarwal-led startup, along with Ather Energy, TVS Motor, and Hero MotoCorp, was being probed by the government for allegedly billing their escooter chargers and proprietary software separately as accessories in order to claim FAME-II subsidy. 

Following this, all four manufacturers last month decided to refund the cost of chargers and software to the customers, cumulatively amounting to INR 288 Cr. Ola Electric had to reportedly refund INR 130 Cr to 1 Lakh Ola S1 Pro customers.

In a statement on Thursday, Ola Electric said it sold over 35,000 escooters in May. 

“Riding on its highest-ever monthly sales in May, Ola has captured an impressive market share of over 30% and has achieved a year-on-year growth of 300% during the last month,” it said.

Meanwhile, TVS Motors, which was at the second spot, saw its vehicle registrations jump over 131% month-on-month (MoM) to 20,254 units in May.

In a sharp reversal, Ather Energy saw its registrations zoom 96% to 15,256 units in May from 7,786 units in April. In April, it witnessed a 36% decline in vehicle sales, which it attributed to the uncertainty created around the FAME-II policy.

However, in a statement issued on Thursday, Ather Energy attributed the rise in its registrations in May to the growth in underlying demand, which it said was fuelled by the impending revision of FAME-II subsidy.

“This (the revisions) led to some consumers bringing forward their purchases, in order to avail the higher subsidy amount. We hope to maintain this momentum as the manufacturing industry and its ecosystem continue to grow,” said Ravneet Singh Phokela, chief business officer of Ather Energy.

It must be noted that following the government’s decision to slash the incentives for electric two-wheelers to 15% of ex-factory price from 40% earlier and cut the demand incentive to INR 10,000/kWh from INR 15,000/kWh, many manufacturers, including Ola Electric, Ather Energy, Matter, have decided to hike their vehicle prices.

The impact of these price hikes on the demand for two-wheeler EVs remains to be seen.

Meanwhile, the trend of growth was visible across OEMs in May. Bajaj Auto’s EV registrations surged 168% MoM to 9,911 units last month, while Lectrix EV saw a 212% MoM jump to 1,000 units in May from 320 in April.

However, Okinawa Autotech and Hero Electric continued to see their vehicle demand dwindle MoM. While Okinawa’s vehicle registrations dropped to 2,905 units in May from 3,218 units in April, Hero Electric saw a 36% MoM decline to 2,109 units.

It is pertinent to note that Hero Electric recorded sales of over 13,000 units in March last year, while Okinawa recorded its highest vehicle registration number of around 15,000 in October last year. 

Overall, total EV registrations grew to 1,57,217 units in May from 1,10,997 in April. The total number of EV registrations in the country stood at 6,19,172 so far in 2023. 

The post Ola Electric Maintains Dominance As 2-Wheeler EV Registrations Cross 1 Lakh Mark In May appeared first on Inc42 Media.