Ola, Hero, Ather’s Rendezvous With FAME-II Sops Got Caught In The Wrong Lane

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The Indian government launched the Faster Adoption and Manufacturing of Electric Vehicles in India Phase II (FAME-II) scheme in 2019 to promote the use of electric vehicles (EVs) in the country. Under the scheme, the government provides subsidies for EV buyers, with a focus on two and three-wheelers.

However, several major players in the EV industry, including Ola Electric, Hero Electric, and Ather Energy, have been facing challenges in availing the FAME-II subsidies. These challenges arise due to the eligibility criteria, which requires EV manufacturers to have a minimum production capacity of 50,000 units annually, which smaller manufacturers like Ather Energy do not meet. Additionally, the subsidies are only available for vehicles that have a minimum range of 80 km per charge, which makes it difficult for manufacturers to offer cheaper vehicles with lower ranges.

As a result, these companies are facing delays in launching new EV models that meet the eligibility criteria for the FAME-II subsidies. For example, Ola Electric had initially planned to launch its electric scooter in early 2021, but due to the eligibility criteria, the launch was delayed until August 2021.

Despite the challenges, these companies are still pushing forward with their plans to expand the EV market in India. Ola Electric has invested heavily in building a network of charging stations across the country, and Hero Electric is planning to expand its production capacity to meet the eligibility criteria for the FAME-II subsidies. Ather Energy is also planning to launch a new, higher-range electric scooter that will qualify for the subsidies.