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NEW DELHI : Mahindra Electric Mobility, TVS Motor Co., Kinetic Green Energy and Power Solutions, Etrio, Mali and Keto Motors Pvt. Ltd have emerged as lowest bidders for an estimated 3,000 crore state-run Convergence Energy Services Ltd’s (CESL) tender to procure 100,000 electric three-wheeled vehicles.

According to information reviewed by Mint, the companies matched the lowest price bid or L1 of 306,691 per three-wheeled passenger vehicle, about 20% less than the prevailing price for such vehicles.

The L1 price for a three-wheeled goods vehicle is 320,322, 15% lower than the market price. With the bid comprising a three-year annual maintenance contract, the overall price reduction is estimated at up to 23%.

“This aggregating exercise has seen a good response, and the market’s strongest players have stepped forward to help build out electric mobility in India. The demand for electric three-wheelers from public and private agencies alike has been very encouraging," CESL managing director and chief executive Mahua Acharya said in an interview.

Mint reported on 19 October about 21 firms bidding for the tender. Of these, a dozen bidders were found eligible and submitted their price bids. “We now await the next steps from CESL in terms of exact quantities and timelines. This has been a long process, involving technical qualification and aggressive price bidding, based on high volumes expected, and we hope that the execution will be rapid as well as smooth," Sulajja Firodia Motwani, founder and chief executive, Kinetic Green, said in an emailed response to queries.

CESL’s plan is to lease around 50,000 electric three-wheelers and sell the rest through its digital platform. The request for proposals asked original equipment manufacturers to offer quotations for such vehicles under different use-cases such as garbage disposal, freight loaders, food and vaccine transport and passenger autos. The tender is for designing, engineering, manufacturing, testing, inspection, supply, transportation, complete system warranty and transit insurance, delivery to the end-consumer and providing after-sales support.

“Financing is the next big challenge, and we will be reaching out to financing entities to understand what it takes and see if and how CESL can help enable appropriate financing," Acharya said.

CESL has also been working with financiers to develop a financing solution for electric-vehicle buyers.

Mint earlier reported that CESL was in talks with non-banking financial companies to reduce interest rates on EV loans by at least five percentage points to make them affordable. This assumes significance given the higher risks with financing EVs for commercial uses, resulting in inflated loan rates for buyers.

A spokesperson for TVS Motor declined to comment. Queries emailed to a Mahindra Electric spokesperson on Friday morning remained unanswered till press time. Queries posted on the Keto Motors website remained unanswered. Spokespersons for Etrio and Mali couldn’t be contacted.

In addition to supplying electric two-wheelers to states such as Andhra Pradesh, Kerala and Goa, CESL has also been aggregating demand for leasing out and operating three-wheeled EVs for the garbage collection fleet of municipalities across the country, including for the Pune Municipal Corporation.

CESL is also looking to supply Swachh Andhra Corp. an additional 15,000 garbage tippers. The firm plans to halve the cost of ownership of these vehicles through incentives offered under the 10,000 crore Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (Fame) scheme, state government subsidies, support from EV makers and carbon credits.

CESL, a unit of Energy Efficiency Services Ltd, aims to have 200,000 two-wheeled EVs and 300,000 three-wheeled EVs across India.

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