The total electric vehicle (EV) registrations, electric two-wheelers in particular, in the country have hit record levels this March, driven by price reductions and per-buying ahead of a revised subsidy scheme (just for 4 months) that will come into effect from April 1.

Total registrations of battery-powered vehicles (including all segments) for March 2024 touched 1.75 lakh units (as of Friday, March 29), the highest-ever monthly number so far. The previous highest monthly number was 1.58 lakh units, which was recorded in May 2023 due to pre-buying ahead of an amendment in the FAME II subsidy scheme.

The electric two-wheeler sales for this month crossed one lakh units, the second time in this fiscal and stood at 1.12 lakh units as of Friday (1.06 lakh units recorded in May 2023).

Improving trend

“Electric two-wheeler volumes have charted an improving trend over the past few months, aided by a reduction in prices across the product range by leading OEMs. The reduction in prices has been supported to an extent by an easing of battery prices over the recent past. The volumes improved from about 82,500 units to about 1.12 lakh units in March 2024 (till date), aided by pre-buying to an extent, ahead of the reduction in subsidy benefits for OEMs under FAME II, said Rohan Kanwar Gupta, Vice President and Sector Head – Corporate Ratings, Icra.

Two weeks ago, the Union Ministry of Heavy Industries announced the Electric Mobility Promotion Scheme 2024 with a total outlay of ₹500 crore to support the adoption of e-2Ws and e-3Ws (including e-rickshaws, e-carts and L5 category vehicles) for a period of four months from April 1, 2024, to July 31, 2024. Around two-thirds of the outlay is to be earmarked for e-2Ws. The subsidy for e-2Ws was cut to ₹5,000/KwH from ₹10,000/KwH earlier with a cap of ₹10,000 per vehicle for e-2W (from 15 per cent of ex-showroom price earlier).

The announcement by the Government of India of the Electric Mobility Promotion Scheme 2024 came as a timely move to support the adoption of EVs in the country, with the FAME-II subsidy expected to see a sunset on March 31, 2024.

For FY24 (with 2 days remaining for the fiscal year to end), the total EV registrations (including segments) stood at about 1.6 million units for FY24 when compared with about 1.2 million units in FY23.

Surge in sales

Total electric two-wheeler sales grew to 9.2 lakh units in this fiscal when compared with 7.3 lakh units in FY23.

Ola Electric has more than doubled its E2W registrations and stood at 3.2 lakh units for FY24 when compared with 1.53 lakh units in FY23. TVS Motor has also more than doubled its electric two-wheeler sales to 1.79 lakh units in FY24 when compared with 82,108 units in FY23. Ather Energy’s registrations crossed the one lakh mark in FY24 and stood at 105,935 units when compared with 76,939 units in FY23, according to Vahan data (as of March 29).

Total electric three-wheeler (e-2W) sales grew to 6.2 lakh units when compared with 4.02 lakh units in FY23.

Electric passenger vehicle sales zoomed to 89,027 units in FY24 when compared with 47,350 units in FY23.

All segments of battery-powered vehicles are expected to report record volumes for FY24. “However, with a reduction in the quantum of subsidy being offered on per vehicle basis vis-à-vis the existing FAME-II guidelines, the initial purchase cost of an e-2W would increase as OEMs will potentially have to take price hikes, the extent of which remains to be seen,” said Gupta.