India’s Electric Two-Wheeler Industry: A Year of Ups and Downs
New Delhi: The Indian electric two-wheeler (2W) industry in 2024 navigated a turbulent landscape, marked by both significant milestones and unforeseen challenges. While the year witnessed a surge in sales, driven by a growing consumer preference for electric mobility, the industry also grappled with the withdrawal of government subsidies, intense competition, and evolving consumer demands.
The FAME II Fadeout: A Catalyst for Change
One of the most defining moments of 2024 was the gradual phasing out of the FAME II subsidy scheme, which had significantly boosted EV adoption in previous years. The scheme, which provided incentives to both manufacturers and consumers, ended in June 2023. While the initial impact of this withdrawal caused some disruption, the market gradually adapted, demonstrating a growing maturity and resilience.
Sales Surge Amidst Challenges:
Despite the subsidy cuts, the Indian EV 2W market continued to expand at a remarkable pace. Retail sales of electric scooters and motorcycles surpassed the 1 million unit mark for the first time in 2024, a significant milestone that underscores the increasing consumer acceptance of electric mobility.
According to Vahan data, cumulative EV 2W retail sales had crossed 10.7 lakh units by November 30, 2024, reflecting a 37 percent year-on-year growth. However, November witnessed a 15 percent month-on-month dip in sales to 1.18 lakh units, largely attributed to a post-festive demand slowdown, which is typical across the automotive industry.
Intense Competition and Evolving Consumer Preferences:
The Indian EV 2W market is witnessing fierce competition, with both established players and new entrants vying for market share. This competitive landscape has led to rapid innovation in product design, technology, and features. Consumers are increasingly demanding high-performance vehicles with longer ranges, advanced features like smart connectivity, and improved after-sales service.
The Rise of the Indian EV 2W Unicorn
2024 also witnessed the entry of India’s first electric two-wheeler manufacturer, Ather Energy, into the public markets. This landmark event marked a significant milestone for the Indian EV ecosystem, showcasing the growing maturity and investor confidence in the sector. Ather Energy, known for its high-performance electric scooters and strong brand identity, successfully raised significant capital through its IPO, further solidifying its position as a leader in the Indian EV 2W market.
Looking Ahead:
Despite the challenges faced in 2024, the long-term outlook for the Indian EV 2W industry remains positive. The growing consumer awareness of environmental concerns, coupled with government initiatives to promote electric mobility, is expected to drive continued growth in the coming years. However, the industry will need to navigate several key challenges, including the development of robust charging infrastructure, the availability of a skilled workforce, and the need for continuous innovation to meet evolving consumer demands.
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The year 2024 will undoubtedly be remembered as a pivotal year for the Indian EV 2W industry, a year of both triumphs and tribulations. As the industry matures and evolves, it will be crucial for stakeholders to collaborate and work together to overcome the challenges and unlock the full potential of electric mobility in India.
