The rapid adoption of electric three-wheelers across India has led to a 123 per cent increase in manufacturing by Original Equipment Manufacturers (OEM) in H1.
According to the statistics of the Society Of Automobile Manufacturers (SIAM), between January and June of 2023, 16,552 electric three-wheelers were manufactured, compared to 7,522 electric three-wheelers between January and June of 2022.
The uptick in manufacturing is due to a spike in demand, with OEMs launching new products with advanced features. With a 14.6 per cent market share, Mahindra’s Last Mile Mobility (LMM) sold 36,816 electric three-wheelers in FY23. Whereas in FY22, the automobile maker sold 17,522 electric three-wheelers.
“In June, we also reached the milestone of one lakh EV sales, reflecting our deep experience and leadership in this space,” said Suman Mishra, CEO of LMM, earlier.
Bajaj Auto, which recently introduced its electric three-wheelers in selected markets, is also seeing green shoots in demand.
Companies did not respond to requests for comment on the uptick in production due to their silence ahead of their quarter results.
“Electric three-wheeler sales volume grew 78 per cent year-on-year and 7 per cent month-on-month. Electric vehicle penetration in three-wheelers was 55 per cent. Tamil Nadu and West Bengal saw the fastest electric three-wheeler month-on-month volume growth. We are still awaiting market leader Bajaj’s entry into the space, which we believe will be the next catalyst for the industry,” mentions a BNP Paribas report for June.
Penetration to rise
The penetration of electric three-wheelers will increase to 16 per cent by FY25 from 8 per cent now. Further, the penetration will rise to 40 per cent by FY30.
“A favourable regulatory environment with central and State government subsidies to lower capital costs, as well as reduction or waiver of registration fees, road taxes, and permit requirements, continues to be supportive of electric auto adoption. With the inherently lower running costs, this results in a much lower (40–45 per cent) total cost of ownership than conventional diesel or CNG three-wheelers, making the conversion to electric autos an attractive proposition,” said Kinjal Shah, Vice President & Co. Group Head, Corporate Ratings, ICRA Limited.
Easy Financing
To increase the sales of electric three-wheelers, companies are also offering easy financing options. Greaves Electric Mobility Private Ltd (GEMPL) recently inked a pact with Bike Bazaar Finance to finance electric three-wheelers.