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Why were sales of electric two and three-wheelers without batteries allowed and will buyers benefit?

The sales of electric vehicles (EVs) are not gaining steam in the country, despite launching two incentive schemes in five years.

In the Year 2019-20, 152,000 electric two-wheelers were sold in India, which is less than 1 percent of the 17.5 million sold during the same year, globally.

That scenario could now change with the government, on August 12, bringing about a landmark change to the buying structure of an electric two and three-wheelers.

What is the change brought about by the government?

The government has allowed the registration of electric two- and three-wheelers without batteries.

Why has this been done?

Batteries account for up to 40 percent of the EV cost. So, the price of an EV with battery deters it from becoming a mass product.

The government believes if the cost of batteries is removed from the price equation, it would bring down the acquisition price of EVs and trigger demand.

Who will provide the batteries then?

The government’s move can give birth to a new tier in the supply chain of electric vehicles. Third-party vendors focusing only on supplying batteries could gain prominence. Batteries can be given on hire or sold as per choice. It will also become easier for the government to source end-of-life batteries from a common place for disposal.

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