Electric scooter sales ride on govt incentives, fuel prices

Electric scooter sales ride on govt incentives, fuel prices
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First Published: Sun, Mar 01 2009. 10 42 PM IST

Robust growth: Hero Electric’s scooters on display at an outlet near New Delhi. The industry expects 30-40% growth in sales this fiscal. Rajkumar / Mint
Robust growth: Hero Electric’s scooters on display at an outlet near New Delhi. The industry expects 30-40% growth in sales this fiscal. Rajkumar / Mint
Updated: Sun, Mar 01 2009. 10 42 PM IST
New Delhi: Just one segment in the automobile industry, it seems, has been able to resist the downward spiral that auto makers have been trapped in—electric scooters.
Makers of battery-operated two-wheelers have been posting robust sales growth at a time when auto manufacturers have seen overall demand shrink by as much as half from a year ago as the economy expands at a slower pace.
Robust growth: Hero Electric’s scooters on display at an outlet near New Delhi. The industry expects 30-40% growth in sales this fiscal. Rajkumar / Mint
Some amount of government help—several states have waived sales and other taxes on electric scooters in the last few months, making them more affordable—has pushed sales. But the big drivers were last year’s high petrol prices, coupled with low maintenance and running costs of electric scooters.
Sales of electric scooters rose 42.25% in the six months ending 31 December, according to a survey conducted by the Confederation of Indian Industry. The industry expects to end this fiscal year with 30-40% growth in sales.
The fledgling industry hasn’t, as yet, started recording numbers, and estimates put the total number of electric scooters sold last year at 100,000, or about one-tenth of the total scooters sold. It comprises just about 1% of all two-wheelers, including bikes, sold in the country.
“About 15,000 were sold last month,” estimates Sohinder Gill, director of corporate affairs at the Society of Indian Electric Vehicle Manufacturers.
Gill, who is also chief executive of Hero Electric, a division of Hero Cycles Ltd, expects his company to sell as many as 30,000 electric scooters this fiscal, up from 21,000 last year.
Apart from large organized players such as Hero Electric, Ultra Motor India Pvt. Ltd and Electrotherm India Ltd, there are as many as 65 different units selling electric scooters in the country. They generally import the scooters or kits that need assembly from China.
Contributing to their popularity is the fact that scooters that have their top speed capped at 25km per hour don’t have to be registered by the road transport authorities. This has made them a convenient mode of transport for teenagers.
Housewives and senior citizens account for a majority of the sales, dealers say.
Rajiv Sandana, who owns and runs a tent-house business, bought his first electric scooter six months ago. He rates it a good buy as he only spends about Rs5 charging his scooter every day compared with the Rs100 he would spend on petrol. His wife couldn’t drive his petrol scooter but she’s comfortable driving its electric version.
Vinod Gupta, the owner of Gogreenauto, a Delhi-based dealer of electric scooters, has seen his sales double to between 80 and 100 units a month since the Delhi government waived taxes in June 2008.
The waiver resulted in electric scooters becoming cheaper by at least Rs7,000, taking the price down to about Rs22,000.
In states that have not removed such levies, typically, the price of an electric scooter ranges between Rs30,000 and Rs40,000.
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First Published: Sun, Mar 01 2009. 10 42 PM IST