Electric scooters and motorcycles are all set to get more expensive from June 1, 2023, with the recent change in FAME II subsidy norms
The government has decided to revise the FAME II subsidy on electric two-wheelers since the original allocation of ₹2,000 crore has been exhausted
To avoid ending the subsidy abruptly and support the rampant growth of electric two-wheelers, the government has now decided to revise the FAME subsidy structure
Under the new structure, the unutilised funds of ₹1,500 crore allocated for electric three- and four-wheelers have now been redirected to electric two-wheelers
In order to ensure the subsidy stays for longer, the payout will be revised to ₹10,000 per kWh instead of ₹15,000 per kWh
The total subsidy will be limited to 15% of the electric two-wheeler’s ex-factory cost that’s capped at ₹1.50 lakh. The previous limit was up to 40% of the ex-factory price
Models like the Ather 450X should be more expensive by about ₹23,000, while the Ola S1 Pro will have its subsidies reduced by ₹37,000
The Tork Kratos R electric motorcycle will get more expensive by about ₹40,000 with the subsidy revision
It’s unclear the extent to which electric manufacturers will pass on the reduction in subsidies. It could take place in a staggered manner to avoid a massive blow to customers