E-two-wheeler sales ride past 500,000-mark in 2022, penetrate 4% of mkt

See big action next year amid a few rough patches on the road

Electric two-wheelers have zipped past the half million registration mark and have achieved a market penetatration of four per cent till the fag end of calendar year 2022, according to data released by VAHAN.

According to VAHAN data for the year till December 27, some 560,000 two-wheelers were registered in the country, up a staggering four fold over 2021, when only 136,000 were registered, and when e-vehicle penetration was a mere 1.05 per cent. The total number of two-wheelers (ICE and electric) registered so far in 2022 stands at 14.5 million vehicles, up by only 12.7 per cent over the previous calendar year.      

The number of electric two-wheelers registered might be lower than the 750,000 figure many had projected in the beginning of the year, but the serious chip problem was a key reason why registrations began slowing down since May, only to claw back in the festive season, when there was a big kick-up in sales. That, and the capex plans in the space have fuelled consensus that the market will cross well over one million easily in 2023.

Consumers can expect a dozen-odd new electric two-wheelers in the market in 2023, with the big push coming from motorbikes, which account for over 60 per cent of the two-wheeler market.

Ampere is expected to showcase a bevy of new scooters at the SIAM Auto Expo in January. Ola plans to launch its electric alternative, Ola S1 Air (priced at Rs 84,999) in April 2023, and clash head-on with Honda’s ICE Activa, which dominates the ICE scooter market (sales: about 120,000 a month). Of course, everyone is waiting for Honda’s next moves.

Ola will also lock horns in the motorcycle space, where everyone is waiting for Bajaj and TVS to make their next moves. And Hero MotoCorp’s quiet entry into electric would be watched too.  

Yet, there are some challenges that could upset the e-two-wheeler applecart. One is the recent crackdown on electric two-wheeler firms, which the government says have violated localisation norms. The firms were to have achieved 50 per cent localisation in order to be eligible for FAME 2 subsidy of a substantial Rs 40,000-50,000 a vehicle. If they don’t get that subsidy, their sales will falter.

Many e-scooter companies are also facing short-term challenges. One such is the implementation of the tough new norms for batteries. This was to be done in two phases--by December 1, and by March 1--to prevent e-scooters from catching fire due to overheating, and address a long-standing concern on the part of consumers. Experts say the implementation of these norms will increase the cost of the battery and, consequently, the price of the e-vehicle.

Overall December registrations till the 27th of the month have been muted at 52,309. This is just 72 per cent of what was achieved in November-a gap most players say cannot be covered within the next four days. But companies like Ather, Oyo and Bajaj and TVS which has not been impacted seriously with the FAME 2 investigations, are pretty close to the levels they achieved in November.

However Okinawa, the world's second largest player in the business, which saw its registrations hit 14,491 in October, is merely a third of that number at 4,422 in December with just a few days to go. This 4.422 figure is also half of what it did in November, at 9,062. Okinawa and Hero Electric are among the companies under investigation for not achieving the localisation norms needed to get FAME 2 subsidy. Hero Electric, at 6,385 registrations in December, is at 70 per cent of what it did in November.  

Ampere, a company acquired by Greaves Mobility, has also seen a dramatic fall. Its registrations so far in December stand at 3,715, which is a third of the 12,259 it did in November. A company spokesperson says, “Ampere has successfully transitioned all its existing products to new battery norms effective December 1. It is normal to see some drop in registrations in December for the industry, but we are confident that in the electric two-wheeler market, Ampere will see a surge starting January.”