Rising Purchase of Two-Wheelers Pushes India’s EV Sales Up by 20% in FY 2019-20

E-rickshaws have not been accounted in this figure as they are broadly in the unorganized sector


The sale of electric vehicles (EVs) in the country went up by 20% in 2019-20. The EV industry sold 156,000 electric vehicles in the financial year (FY) 2019-20. Out of the total, 152,000 were two-wheelers, 3,400 cars, and 600 buses, according to the Society of Manufacturers of Electric vehicles (SMEV).

However, in FY2018-19, 126,000 two-wheelers, 3,600 cars, and approximately 400 buses were sold totaling 130,000 units. The increase of 20% has mostly come from electric two-wheelers. However, it does not include electric rickshaws, which broadly fall under the unorganized sector with a reported sale of nearly 90,000 units. The corresponding figures of the electric rickshaws sold in the previous year have not been documented.

In the electric four-wheeler segment, 3,400 units were sold compared to 3,600 units in the previous fiscal year.

According to SMEV’s report, “Of the electric two-wheelers that were sold in FY19-20, 97% were electric scooters, and a very small volume of motorcycles and electric cycles filled the rest of the 3%. Low-speed scooters that go at a maximum speed of 25km/hr and do not need registration with the transport authorities constituted a whopping 90% of all two-wheelers sold.”

Sohinder Gill, director-general of SMEV, said, “The EV industry is taking shape, and we believe that despite the COVID-19, the FY 20-21 will be a defining year for all the EV segments. While the EV industry is surely going to face the brunt of COVID-19 like any other automotive business, the clearer skies and cleaner air in even the worst polluted cities, is certainly leaving a permanent impression in the minds of the customers about how they can breathe easy and remain healthy if the society moves towards e-mobility.”

He pointed out that a pertinent factor that may work in favor of electric two-wheelers post COVID-19 would be the choice of switching over from crowded mass transport to the sensibly priced electric two-wheelers with almost the same cost of commuting as of public transportation.

“The decrease in numbers is attributed mainly due to the lack of bulk purchase of e-cars in FY19-20 and the discontinuation of one of the leading car models. The acceptability of electric cars in the premium segment in the second half of the year was a positive signal of a quantum jump of a much higher volume of E-cars in FY20-21,” the report added.

The e-taxi segment is also beginning to get some traction, though the range of E-cars and lack of charging spots in enough density are a deterrent in the growth of the E-taxi segment, it noted.

The report stated that the significant commitments by state governments on e-buses did not translate into buses.

Gill believes that given the right impetus by the government and the industry, the EV industry can spring back faster than the ailing internal combustion (IC) vehicles segment.

“Few experiments like electric two-wheelers being sold without the batteries and customer paying for the batteries as a fuel, e-commerce companies realizing the economic benefits of EVs and converting their fleets. E-carts are becoming a convenient and cost-effective means of short distance logistics. E-taxis fleets are beginning to make money due to lower operating costs that may bring around the inflection point in the EV industry in FY 21-22,” he added.

Commenting on the SMEV’s report, Maxson Lewis, the managing director of Magenta Power, said that there had been a surge in sales of EVs, which is a good trend.

“But this growth has to be seen from the lens of absolute numbers which show that there is a long way to go before EVs reach significant numbers to make a storyline as against ICE engines. These growth numbers showcase one important fact– availability will drive demand. Past years saw the release of many electric vehicles, especially in the electric two-wheeler space, which is also the largest growth driver. Here, the availability of options was also supported by the lower cost of transition and the fact that EV in its current formats lend themselves to short runs,” Lewis told Mercom.

As reported previously by Mercom, Budget 2020 failed to meet the expectations of the electric vehicle (EV) segment of the country. The segment’s stakeholders were expecting more measures from the government to promote electric mobility in cities. As per the Union Budget announcement, imported EVs are going to get costlier with the government increasing the customs duty on various kinds of such vehicles as the government pushes for local production. The government has allocated ₹6.93 billion (~$96.8 million) for the Faster Adoption and Manufacturing of (Hybrid) and Electric Vehicles in India (FAME-India) program for the financial year 2020-21.

Earlier, the Ministry of Heavy Industries and Public Enterprises had released a revised list of parts that are to be indigenized under the Phased Manufacturing Program (PMP), which falls under phase II of the FAME program. The list consists of 20 eligible components that are used in electric vehicles across the two, three, and four-wheeled segments, which will be covered under the PMP.