Govt plans sale, registration of EV two, three wheelers without batteries

Battery, which accounts for 30-40% of the total cost of a vehicle, could be provided separately.

The government plans to allow companies to sell electric two and three wheelers without batteries to "create an ecosystem" for clean transport, said a notification on Wednesday. EVs can be registered for use without a battery, too.

The battery, which accounts for 30-40 per cent of the total cost of a vehicle, could be provided separately by the original equipment manufacturer or the energy service provider, said the transport and highways ministry in a notification to states. 

The step will make the upfront cost of the vehicles to be lower than ICE two-wheelers and three-wheelers. 

The ministry said the vehicles without batteries can be sold and registered based on the type approval certificate issued by a test agency. It said there is no need to specify the make/ type or any other details of the battery for registration.

Commenting on the development Sohinder Gill, Director General, Society of Manufacturers of Electric Vehicles ( SMEV) said "it's good to know that various ministries are coming out with ideas on how to promote EVs. Delinking of Batteries from EVs is one such good idea, however lots need to be done before it becomes practically implementable and beneficial to the customer".

He added, to a customer the EVs still have to be purchased along-with the batteries as there are hardly any battery swapping/ rental/leasing business models in sufficient density in the cities.

Some policy announcements that should have been made along-with this policy including reduction of GST of batteries from 18 per cent to 5 per cent if sold separately and mechanism of passing on the FAME subsidy to such EVs as currently subsidy is calculated on the battery power, said Gill.

Mahesh Babu, MD & CEO of Mahindra Electric, added that no country in the world allowed registration of EV’s without battery.

"We will explain to the government that this notification has created confusion. The OEM is responsible for the safety of the vehicle till the sale. The OEM is responsible for the warranty of a vehicle that is tested, manufactured and sold as an integrated vehicle. Charging or swapping are post sale charge replenishing methods.  Both can exist in the current framework.  This move has not been thought through and the industry has not been consulted”, he said.

Tarun Mehta, CEO and Co-founder, Ather Energy said that the Ministry's new policy is a great move for both customers and OEMs. 

Whie the new policy opens up new opportunities in financing options, it will take some time for consumers to understand and adopt this model of ownership, but in the long run it will be a big boost to the Indian EV industry.

"It will also make it easier for new players to join the industry. With BS-6 increasing petrol scooter prices, we expect consumers to shift to electric scooters, which offer great performance, in the months to come,” he said.

Naveen Munjal, Managing Director of Hero Electric said “The policy is a welcome move. I am excited about the possibilities that exist in making EVs accessible to every individual in the country. All we need is a combination of such pioneering policies for it to work for us as per plan in the long-run will work in the long term. For this to take off and be able to efficiently pass on the benefit to the consumer, we ought to work towards a strong infrastructure that allows EV owners to charge and swapping batteries wherever they require. I look forward to more such positive interventions.”