Electric bike sales decline 50% in April amid subsidy changes

Electric two-wheeler sales saw an about 50% month-on-month drop in overall sales in April as a seasonal slump was exacerbated by a shift in subsidies for the industry.

Overall EV scooter sales stood at just over 64,000 in April, with market leader Ola Electric contributing about half of that with over 33,000 units.

However, Ola itself saw its sales retreat from a record high of over 50,000 units in March 2024.

In March, the overall market saw record sales of over 136,000 units, according to data from government transportation portal Vahan.

On the other hand, legacy firms like Bajaj and TVS Motors also saw a slump in their sales. Bajaj only sold over 7,500 units in April, compared to over 18,000 units in the previous month. On the other hand, TVS sold just over 7,600 units in April, compared to sales of around 26,000 units in March.

Ather Energy, which recently entered the large family scooter market with its latest product Rizta, sold over 4,000 units in April, compared to sales of over 17,000 units in March.

The drop in overall sales was due to a number of factors, a senior executive at an electric scooter maker said.

April is usually a sluggish month, but firms were also slowing down production and rethinking their strategy as the industry shifted from one subsidy to another, the executive added.

On March 31, the FAME-II subsidy programme ended, giving way to the Rs 500-crore Electric Mobility Promotion Scheme (EMPS) by the ministry of heavy industries.

Under EMPS 2024, a support of up to Rs 10,000 per two-wheeler will be provided for over 3 lakh vehicles.

The new subsidy does not cover unsold vehicles that were manufactured before April 1, which also led to firms slowing down their manufacturing and sales, while awaiting further clarity on subsidies.

The overall two-wheeler EV market, however, grew 30% from a year earlier to over 940,000 sales in FY24.

It has also continued to garner investor interest, as ET has earlier reported.

Ather Energy is finalising plans to raise USD 75-90 million in primary funding, while Ola Electric is awaiting the market regulator's nod to list on the public bourse.