Ola Electric saw its market share expand to more than 50 percent in April, selling 33,934 electric two-wheelers, despite a broader 52 percent slump in overall EV two-wheeler sales to 64,013 units from the preceding month, according to Vahan website data as of May 1.
The overall decline in sales is mainly due to April being a seasonally slow sales period coupled with demand tapering down post-festive season, industry sources told Moneycontrol. EV two-wheeler sales during April 2023 were at 64,855 units.
“The EV two-wheeler sales are flat at 1 percent year-on-year (YoY). This is because April is usually a slow month for sales. Last month was the end of financial year and many OEMs were offering huge discounts, which would have led to a boost in sales,” said an industry source requesting anonymity.
India witnessed record electric two-wheeler sales in March, exceeding 136,000 units, marking a 50% increase from a year earlier. Sales touched 942,088 units in the 12 months ended March 31, up around 30 percent from the previous year, boosted by year-end discounts.
Also Read: Electric two-wheeler sales rise 30% in FY24 to 9.42 lakh units
To be sure, Vahan only records the total number of sales registered and not the bookings. It also does not take into account low-speed E2W sales and excludes the data for Lakshadweep, Madhya Pradesh and Telangana
Industry experts also attribute the lower sales to issues around subsidies being blocked by the Ministry of Heavy Industries (MHI) since last year.
"Stagnation in the growth of electric two-wheelers can be attributed to both the significant reduction in subsidies and the challenges faced by several OEMs. The decrease in subsidies has led to higher prices for electric vehicles, except for those like Ola, which have heavily discounted their products," said Sohinder Gill, director general of the Society of Manufacturers of Electric Vehicle (SMEV).
Additionally, the issues with subsidies being stuck with the government have impacted the ability of some vehicle makers to offer affordable products, hindering market growth. This situation has resulted in the electric two-wheeler market experiencing negligible growth, he added.
The Central government had blocked pending subsidy claims of two electric vehicle manufacturers under the FAME India Phase II scheme, said Krishan Pal Gurjar, the minister of state for heavy industries, while answering the Lok Sabha in March 2023.
The ministry had received complaints related to the violation of Phased Manufacturing Programme (PMP) guidelines under (Faster Adoption and Manufacturing of Electric Vehicles) FAME India Scheme Phase-II by two Original Equipment Manufacturers (OEMs).
The Central government also reduced the budgetary allocation for the FAME scheme by nearly 44 percent to Rs 2,671 crore for FY25, which industry players predict could result in a slowdown in the adoption of EVs.
FAME India Scheme is a government subsidy scheme under the National Electric Mobility Mission Plan (NEMMP) and stands for Faster Adoption and Manufacturing of Hybrid and Electric Vehicles
Ola Electric tops the market share game
Despite an overall slowdown, Ola Electric scooped up around 50 percent market share, with sales of around 33,062 units in April. However, to be sure, Ola Electric’s month-on-month sales have also come down by 34.8% percent. Last year in April, Ola Electric sold nearly 22,068 units.
"Our robust cost structures and vertically integrated manufacturing capabilities have collectively contributed to this uptick in our market share. With the deliveries of our mass-market S1 X portfolio starting soon, we are all set and excited to enter the mass-market 2W EV segment in India," said Anshul Khandelwal, Chief Marketing Officer, Ola Electric.
Interestingly, Bajaj has seen an 84 percent YoY uptick in sales to around 7,515 units in April. In March, Bajaj sold around 18,054 units of two-wheelers.
Industry sources told Moneycontrol that several players have also reduced their production to exhaust their existing stock to launch newer products in the coming months.
TVS Motors, for example, saw its sales go down by 13 percent YoY to 7,653 units. In March TVS had sales of around 24,000 units. In April 2023, TVS reported sales of around 8,760 units.
Ather Energy saw a 48 percent YoY decline in sales to 4,502 units. In April 2023, the firm saw sales go up to 7,802 units. In March 2024, Ather recorded sales of 3,010 units.
The mass market segment in focus
Several players are increasingly focussing on doubling down the production of affordable vehicles.
Ola Electric launched its S1 X, which is the most affordable electric scooter in Ola Electric's lineup. It is being offered in their battery pack options - 2 kW, 3 kW, and 4 kW. They are priced at Rs 69,999, Rs 84,999 and Rs 99,999.
Ather Energy in March launched its first family scooter, 'Rizta,' to expand its offerings and scoop up more market share. The pre-order price of this was pegged at Rs 1,09,999. Bajaj has only one model, ‘Chetak’ in the market which comes under the affordable segment.
Similarly, the TVS iQube e-scooter remains a competitive scooter in the market and the firm has said that it will be increasing production of the same in the coming days.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
