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Business News/ Industry / Manufacturing/  Electric 2-wheeler sales on upswing after subsidy shock
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Electric 2-wheeler sales on upswing after subsidy shock

Meanwhile, internal combustion engine two-wheelers also reported a growth of 22%

High-speed e-two-wheelers’ sales rose 20% in September.Premium
High-speed e-two-wheelers’ sales rose 20% in September.

The electric two-wheeler industry, after setbacks because of subsidy reductions on electric vehicles (EVs), is now showing signs of recovery, with companies readying to launch new, low-cost models.

Sales of high-speed electric two-wheelers rose 20% in September from a year ago and 2% from the preceding month, for a total of 63,716 units, according to the government’s Vahan database, which records vehicle registration data.

Meanwhile, internal combustion engine (ICE) two-wheelers also reported a growth of 22% as the festive season boosts demand for top-end vehicles.

E-two-wheeler volumes dipped to 46,000 after the government significantly slashed the incentives it offered on EVs, resulting in vehicle prices increasing suddenly. However, analysis by equity research firm Elara Capital suggests that the average monthly registration rate for electric two-wheelers for the first half of 2023-24 stood at 66,600 units, reflecting sustained growth in e-two-wheeler sales. In comparison, the average monthly registration rate for the entire 2022-23 was slightly lower at 60,500 units.

Electric scooters represented 4.9% of India’s total two-wheeler market by the end of September, marginally lower than 5% at the end of August. Consolidation in the electric two-wheeler market continued into September, as a handful of top EVs increasingly account for the bulk of sales in the segment.

Ola Electric maintained its lead at the top of the market, with 18,635 units registered in September, securing a 29.2% market share. TVS Motor Co. is accelerating its production ramp-up for the iQube aggressively, with the scooter now accounting for 24.3% of the market. Ather Energy held an 11.2% market share, and Bajaj Auto and Greaves’s Ampere followed with 11.1% and 5.7% of the market, respectively.

“Electric two-wheeler volumes continue to see a steady improvement. Post the reduction of subsidy, the volumes for June were at 46,000 units, which improved to 64,000 units in September. The EV contribution is also now at 4.9%, which compares to around 5% in the second half of FY23 when subsidies were higher. We expect this contribution to inch up further in H2 this fiscal and in FY25 as companies launch models at a competitive price to offset the subsidy reduction impact, and by reducing the battery capacity and implementing cost reduction measures from suppliers to benefit from scale," said Jay Kale, an analyst at Elara Capital.

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Alisha Sachdev
Alisha Sachdev is an assistant editor with Mint based in Delhi. She reports on the auto and mobility sector, with a special focus on emerging clean mobility technologies. She also focusses on developing multimedia properties for Mint and currently hosts the 'In A Minute' series and the Mint Primer podcast. Previously, she has worked with CNBC-TV18 and NDTV.
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Updated: 02 Oct 2023, 12:13 AM IST
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