Rising petrol prices that have topped Rs 100 a litre in some cities have fuelled demand for electric two-wheelers. Three of India’s top electric scooter makers, who control more than 85 percent of the market, have seen their retail numbers grow by 1.5-2 times in the last few weeks.
Much of the demand is attributed to around 11 percent increase in the price of petrol in the past 10 weeks in Mumbai and other cities. In mid-June, the Centre increased the subsidy on electric two-wheelers by Rs 5,000 per kWh to Rs 15,000 kWh, bringing down the prices of such vehicles.
"There has been a steep rise in demand for electric two-wheelers in the past few weeks and currently the demand is far outstripping supply,” said Naveen Munjal, Managing Director, Hero Electric.
For a rider doing 30-40 km daily, a petrol scooter would cost one litre of fuel a day, which translates to Rs 100 daily, he said. An electric scooter will consume 1.5 units of power, which costs around Rs 12 in most parts of the country. “The gap is Rs 88 and that is huge. The EV is not just becoming free, it is paying you back. Customers are able to understand this now,” Munjal said. Hero Electric is the market leader in the segment.
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From charging a 25-30 percent premium, electric two-wheelers are now priced either on par or even cheaper than their petrol counterparts. This, however, depends on the incentives offered by the state where the vehicle is sold.
These incentives are over and above those offered by the Centre, which is keen on pushing these vehicles to cut down India’s import bill and save precious foreign exchange.
Nilay Chandra, Director (marketing and charging infrastructure), Ather Energy said the consumer knows that the petrol prices would not slip back to what they used to be. The cost of ownership they had anticipated had changed and fast, pinching their pockets.
“The decision to buy a second petrol scooter is now way more hurtful than before. Compared to our prediction of retail in June which we did in May, the actual retails have gone up by 1.5-2X times than that,” Chandra said.
A petrol scooter delivers a maximum mileage of 45 km a litre, whereas an equivalent high-speed electric scooter will run for 80 km on a full charge. Low-speed or high range electric scooters can run for up to 120km on a full charge.
“From a pre-Covid number to now we have seen at least a 2X to 2.5X kind of growth in footfalls. In terms of sales from a pre-COVID number we are somewhere between 1.5 and 2X number,” Chandra added.
Gujarat and Maharashtra have come out with EV policies in the past few weeks and these will come into force over the next few days. The demand for electric two-wheelers is expected to go even higher in these two states even as more governments begin to warm up to the idea of electric mobility.
“The lowering prices only helped us persuade more riders to convert from a combustion-engine to an electric scooter. People have begun to consider the electric two-wheeler over petrol-powered two-wheelers as fuel prices have risen,” Jeetender Sharma, Managing Director and Founder, Okinawa Autotech, said.
The operating cost of an e-scooter is a tenth of the combustion-powered two-wheeler, he added.
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