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Electric Scooters To Face Upward Price Revision, Courtesy New Subsidy Scheme
News by Team Drivio | 19 Mar 2024
Electric scooters prepare for cost increase with the launch of new subsidy program
- April 1st is a significant date in the history of electric vehicles.
- The driving force is the government's Electric Mobility Promotion Scheme (EMPS) 2024.
- Significant price increases are anticipated by Investment Information and Credit Rating Agency of India Limited (ICRA).
According to an investigation by a top rating agency, get ready for a sharp rise in the upfront expenses of electric bikes and scooters as the cost of e-mobility continues to rise. The new price change with affect popular electric scooters such as TVS iQube, Ola S1 Pro, Ather 450 Apex, etc., along with other upcoming Ather Rizta scooter in the segment.
The Electric Scooters To Turn Pricier
On April 1st, the Electric Mobility Promotion Scheme (EMPS) 2024 of the government will take effect, causing a significant change in the electric vehicle scene. In comparison to the previous FAME 2 scheme, the Investment Information and Credit Rating Agency of India Limited (ICRA) predicts that this new program will significantly increase the upfront expenditures associated with buying electric motorcycles and scooters by ten percent.
Shake-Up in Subsidies: Details
The maximum benefit under the EMPS 2024 is limited to Rs 10,000 per vehicle, with the subsidy for electric two-wheelers being reduced from Rs 10,000/kWh to Rs 5,000/kWh. Over the course of the four-month program, which runs from April 1 to July 31, a total of Rs 500 crore will be spent.
However, according to ICRA's estimations, almost two-thirds of this figure will go toward purchasing electric two-wheelers, which will result in a significant increase in consumer prices.
The Price of Going Green: Prepare for Sticker Shock
Given that manufacturers are anticipated to transfer the drop in subsidies to consumers, the cost of electric two-wheelers may now surpass that of their internal combustion engine (ICE) equivalents by more than 70%. According to ICRA's prediction, the payback period for electric two-wheelers may reach 5.5 years, which is a duration that is six months greater than that of the FAME 2 framework.
Well-known models deal with rising costs
Here's a sneak peek at how the EMPS 2024's changes to subsidies may affect some of the most well-liked electric scooter models available:
| Model | Current Price | Estimated Price (+ Rs 10,000) |
|---|---|---|
| Ola S1 Pro | Rs 1,39,999 | Rs 1,49,999 |
| Ather 450X | Rs 1,39,000 | Rs 1,49,000 |
| Bajaj Chetak | Rs 1,44,000 | Rs 1,54,000 |
| TVS iQube ST | Rs 1,08,999 | Rs 1,18,999 |
| Simple One | Rs 1,44,999 | Rs 1,54,999 |
| Hero Vida V1 Pro | Rs 1,59,000 | Rs 1,69,000 |
The Journey Ahead: Exciting but More Expensive
ICRA is nevertheless upbeat about the electric two-wheeler market's long-term prospects despite the early financial obstacles. The organization projects that by 2025, the percentage of electric two-wheelers in the sector would increase from the current 5% to 6–8% due to factors including longer range, increased safety features, and lower ownership costs as compared to internal combustion engine (ICE) vehicles.
Furthermore, it is anticipated that government programs like the Production Linked Incentive (PLI) scheme would increase the uptake of electric vehicles over the medium run, opening the door to a more environmentally friendly—though more expensive—future for two-wheeled electric mobility.
