E2W sales up 16 per cent YoY in June-Sep'23 despite price hike, subsidy cut

The recent rise in Electric Vehicle (EV) prices has deterred citizens from buying electric two-wheelers (E2W) in the country. Even if prices have increased after the government reduced FAME subsidies, EV manufacturers have observed sales are gradually creeping back. The government had reduced FAME subsidy from earleir 40 per cent to around 15 per cent on E2W purchases made from June 1, 2023. Albeit, companies had reported sharp reduction in sales immediately after the subsidy cut, but, sales gradually picked up from June 1, 2023. Companies have managed to sell more vehicles in four months period ranging from June 2023 to September 2023 as compared to what these companies could sell in year ago period even when subsidies were higher that time. The government had cut subsidies from June 1, 2023.

E2W sale has increased 16 per cent YoY in June-Sep 2023 period to 2.27 lakh units from 1.96 lakh units in year ago period. The average E2Ws sold in this four months period is 56,000 in FY24. While, four months average sale in year ago period was only 49,000 units.

The E2W sales had dropped massively by 130 per cent MoM to 46,062 units in June 2023 from 1.05 lakh units in May 2023. Recently, EV manufacturers clocked sale of 63,913 units in September 2023.

Due to subsidy cut, prices of E2Ws had jacked up but even then, sales have shown gradual recovery.
Clearly, subsidy cut and resultant price hike have not deterred citizens from playing their part in contributing to the clean and green aspiration of the government of India.

One probable reason could be recent launch of affordable E2Ws by manufacturers. After the subsidy cut, Ola Electric had launched its most affordable e-scooter S1X at Rs 79,999. While, its rival, Ather Energy, drove-in its most affordable E2W, 450S, at Rs 1.30 lakh. Plus economic recovery reaching more pockets of lower strata of the economy, have also contributed to pick up in sales.

Rakesh Sharma, ED, Bajaj Auto, had recently said, that, it makes monthly sense for consumers to drive green mobility as expense and maintenance cost is lower vis-a-vis ICE vehicles.

The government had reduced subsidy on EVs from June 1, 2023 onwards. Because of that, prices of E2Ws had jacked up by 15-20 per cent, according to industry experts.