The Ministry of Heavy Industries is also introducing e-vouchers for EV buyers to avail of demand incentives under the scheme.
New Delhi: The adoption of electric two-wheeler vehicles in India is on a gradual rise and it is expected that their share will rise to upwards of 13 per cent by 2026-27, investment banking company Jefferies asserted in a report. In the financial year that ended in March 2024, the share of electric two-wheelers was at 5 per cent.
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Share of EVs in two-wheeler sales rose from just 0.4 per cent in 2020-21 to 5.4 per cent by early 2023, led by rising subsidies and new launches.However, Jefferies claimed that a subsequent reduction in incentives has resulted in the share remaining in the 4-7 per cent range for most of the past 24 months, despite the introduction of lower-priced vehicles by manufacturers.
“We currently assume share of E2Ws rising from 5 per cent (0.9mn units) in FY24 to 7 per cent/10 per cent/13 per cent (1.4mn/2.3mn/3.4mn units) in FY25E/FY26E/FY27E, although we now see a downside risk to these estimates in the context of the new scheme targeting just 2.5mn E2Ws over two years,” Jefferies said in its report released earlier this week.
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Ola Electric, which has recently become a publicly listed company, has emerged as the dominant manufacturer in India’s electric two-wheelers market, said Jefferies, noting that its market share rose from 21 per cent in 2022-23 to 35 per cent in 2023-24 and further to 49 per cent in 1Q-2024-25.However, as per the Jefferies report, Ola’s market share has subsequently fallen to 31 per cent in August and just 29 per cent in September (month-to-date).
Bajaj, TVS and Ather, on the other hand, have gained 5-9 percentage points each since June quarter, it said.This week, the Union Cabinet has approved a scheme for the promotion of electric mobility in the country. The scheme has an outlay of Rs 10,900 crore over two years.
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The Cabinet’s approval for the ‘PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM E-DRIVE) Scheme’ was based on a proposal from the Ministry of Heavy Industries (MHI). Among others, subsidies or demand incentives worth Rs 3,679 crore would be provided to incentivise e-2Ws, e-3Ws, e-ambulances, e-trucks and other emerging EVs.
The scheme will support 24.79 lakh e-2Ws, 3.16 lakh e-3Ws, and 14,028 e-buses, a release said. The Ministry of Heavy Industries is also introducing e-vouchers for EV buyers to avail of demand incentives under the scheme.
