EV makers, including Ola and Ather, to refund charger cost to customers: Report

Indian electric two-wheeler manufacturers plan to refund customers in crores to be able to qualify for FAME II incentives. EV makers like Ola Electric, Ather Energy, TVS Motor and Hero MotoCorp plan to issue refunds on the cost of EV home chargers they had attached along with the cost of the two-wheelers. According to a report by Mint, the move is seen as an attempt by the EV manufacturers to get Centre's incentive which has been delayed by a couple of months.

According to the report, the EV makers have been charging the cost of the EV charger separately from customers. The trick was to allow buyers to take benefits of FAME incentives, which is offered on electric vehicles with a price tag of up to ₹1.5 lakh. The government had stopped issuing subsidies worth ₹800 crore after finding the loophole. Since then, most of the electric vehicle manufacturers have made the amendment, and now offer EV home chargers as part of the vehicle's invoice.

The biggest setback will be reportedly for Ola Electric. The electric two-wheeler manufacturer, which began operations in 2021, is reportedly going to refund worth ₹130 crore to customers who were asked to pay for the home chargers that came along with S1 and S1 Pro electric scooters. Ola Electric has not issued any statement regarding the refund or the exact amount.

Ather Energy, TVS Motor or Hero MotoCorp too have not come out to issue any statement or clarification over the developments. The overall amount of the refund is not known officially. However, according to Society of Manufacturers of Electric Vehicles (SMEV), the Centre owes nearly ₹1,200 crore to EV makers.

The Centre had stopped rolling out FAME benefits to EV makers after finding out the irregularities. At least two electric two-wheeler manufacturers faced suspension from getting incentive benefits as they did not meet localisation norms which is part of the criteria to be eligible for FAME subsidies.

The future of FAME II subsidy is also uncertain. The extension of the FAME II subsidy scheme was one of the key demands from the Indian auto sector ahead of the Union Budget earlier this year. Various industry stakeholders, including vehicle manufacturers, component makers and charging infrastructure developers, hoped for tax relaxations, benefits and incentives which did not happen.