Electric two-wheeler sales FY2021
The electric two-wheeler sales have been decreased in FY2021 by 5.4% from 152,000 units in FY2020 to 143,837 units in FY2021 because of the global COVID-19 pandemic. But however, the sales of the high-speed electric two-wheelers witnessed a growth of 47%. The increase in the sales of high-speed E2Ws is by established players such as Hero Electric and Okinawa that shares 53% of the market. The Startups like Pure EV, Revolt and Ather Energy also increased their shares.
The cost of electric vehicles is a bigger barrier to EV adoption in India. But the recent announcement of the government about the FAME-II scheme, incentives for E2Ws have been increased from INR 10,000/kWh to INR 15,000/kWh and the cap on incentives has gone up from 20% to 40%.
It has brought down the price of the electric two-wheelers as the price of the ICE vehicles. The electric two-wheelers are witness significant disruption after 2023 once the battery prices fall below $100/ kWh.
34 new models were launched
In FY2021, 34 new models were launched out of which 19 were LS (low speed less than 25 kmph speed) E2Ws. Although the LS E2Ws, apart from being more affordable, are also exempted from RTO registration and riders don’t need a driving license and there are no helmet compulsions, making it popular.
However, they face challenges when it comes to E2W adoption, as they cannot match the performance ICE-counterparts offer and many players who offer LS E2Ws cease to exist in a matter of months, due to low sales margins and increasing competition in the market, denting the confidence of customers.
JMK Research estimates that E2W sales would reach 30 lakh units in the next 5 years. Witnessing a CAGR of 84% from FY2021 to FY2026. India is most popular for its huge two-wheeler market. Most people prefer two-wheelers to meet the needs of personal mobility. In FY2021, two-wheelers registrations alone accounted for 80% of the total vehicle registrations in India. Out of this, E2Ws accounted for 0.8% of the total 2W registrations in FY21. The market will grow from 1.43 lakh units in FY2021 to 30 lakh units in FY2026.
FAME II scheme modified and extended till 2024
On 11 June 2021, the Ministry of Heavy Industries and Public Enterprises released a notification making partial modifications to the FAME-II Scheme. The modifications indicate that the government is focusing on E2Ws to push the adoption of EVs in India.
As per the notification:
- Incentives on E2Ws have been increased from INR 10,000/kWh to INR 15,000/kWh Cap on incentives for E2Ws increased from 20% of the cost of the vehicle to 40% of the cost of vehicle.
- Further, on 25 June 2021, the Ministry of Heavy Industries and Public Enterprises released another notification, notifying about the extension of the FAME II scheme till 31 March 2024.
- Extension of validity of FAME-II certificates The Ministry of Heavy Industry and Public Enterprises, Department of Heavy Industries (DHI) has released a notification.
- Extending the validity of FAME II certificates for all EV Models (E2W, E3W and E4W) approved under FAME II by one year. The notification also states that OEMs/Testing Agencies will have to submit the revalidation certificate within an additional timeline of one month from the last validity date of the certificate.
Electric two-wheeler market size
- FY2021 witnessed a slump of 5.37% in FY 2020-2021 with 143,837 units sold as opposed to 152,000 units in the last fiscal year.
- Although the covid-induced lockdown and its consequential challenges slowed down the growth of the E2W market in FY2021.
- However, in April 2021, sales again began dropping due to the spike in the COVID case with the second COVID wave.
- High-speed electric two-wheelers growth of 47%, with 41,048 units being sold in FY2021 as opposed to 27,787 units sold in FY2020.
- The share of high-speed E2Ws in the overall E2W sales went up from 20% in FY2020 to 28% in FY2021. LS E2Ws witnessed a decline of 17.9% vis-à-vis FY2020.
The next year’s registration figures will see the market recover from the slight slump caused by the COVID pandemic and are expected to witness a growth of around 75%.
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