SMEV asks Niti Aayog to provide Rs 40,000 incentive on each e-scooter

Transfer of subsidy directly to manufacturers will ensure democratic access to subsidy for e-vehicle

Electric vehicle (EV) makers have asked Niti Aayog to formulate policies for giving incentives worth Rs 40,000 on every e-scooter to accelerate adoption of such vehicles powered by lithium battery.

In a letter to the government think-tank, Society of Manufacturers of Electric Vehicles (SMEV) said the more technologically advanced lithium battery powered scooter currently costs around Rs 80,000 and in order to push sales, cost of such two-wheelers needs to be brought down.

"We request Niti Aayog to formulate enabling policies that allow the government to implement one year incentive (2018) for any manufacturer who sells an e-scooter, fully CMVR certified and fitted with BIS certified lithium battery at an on road price of Rs 40,000 to the customer anywhere in India," SMEV Director-Corporate Affairs Sohinder Gill said.

The government can then pass on the Rs 40,000 subsidy (against Rs 22,000 at present) directly to the manufacturer, he added.

"One can then envision mass conversion to electric mobility due to the attractive proposition," Gill said.

Elaborating further, he said that a fixed price of Rs 40,000 will ensure that manufacturers do not take advantage of the subsidy to increase their margins.

Transfer of subsidy directly to manufacturers will ensure democratic access to subsidy for the actual electric two- wheeler use and reduce chances of graft and middlemen, Gill said.

The scheme can even be announced for six months extendable by another six months or for a fixed number of e- two-wheelers, he added.

"SMEV strongly believes that such an initiative would surely have a snowballing effect on the adoption of e-two wheelers," Gill said.

Despite efforts put in by the industry and government, sales of electric scooter remain abysmally low -- 15,000 to 20,000 units per year -- against whopping 1.7 crore petrol two-wheelers annually.

High price of lithium powered scooters, even after subsidy, is one of the main reasons for low sales. Currently, 99 per cent of the electric scooter sold are powered by low speed lead batteries due to affordability factor.