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India Industry Forecast

EV Two-wheeler Players Slash Prices to Garner Better Market Share

Several two-wheeler electric vehicle (EV) makers have reduced prices of their vehicles in their bids to grab market share in the burgeoning Indian market. Such slashing of prices by substantial amount has intensified competition with the traditional petrol-driven scooters, which run on Internal Combustion (IC) Engines. In recent months, all major EV players have announced price reduction.

Ola Electric, Ather Energy, Okaya EV, and Bajaj Auto-owned Chetak Technology are some of the players to slash prices. While Ola Electric, led by Bhavish Aggarwal, slashed prices by up to Rs 25,000 on its S1 Pro, S1 Air, and S1X+ models, leading to a surge in bookings; Ather Energy reduced the price of its 450S model by Rs 20,000. Similarly, Bajaj Auto’s Chetak scooter has also made its models available at more competitive price points.

Such price reduction is driven by many factors that include falling battery costs, cost saving measures and more adoption of technology among others. Such reduction is likely to give a surge to volume in coming months. However, industry experts doubt its impact on profitability factors given the current state of affairs at the EV industry.

Two-wheelers in the EV space has seen rapid growth in recent years. Especially, adoption is majorly driven by urban areas. Sales of EV vehicles rose by 26 per cent to 81,608 units in January compared to the same month last year. Despite such rapid growth, electric scooters still constitute only a fraction of total two-wheeler sales. It only accounts for 4.5 percent of the overall two-wheeler market as of now.

However, rise in better charging infrastructure, subsidies given by various government agencies, environmental concerns and related factors are likely to put the sales chart of EV two-wheelers in a high growth path in coming years.