Posco Daewoo Postpones Launch of Electric Two-Wheeler in India
Posco Daewoo, a prominent South Korean enterprise, has decided to postpone its reintroduction into the Indian market for electric two-wheelers due to unclear in electric vehicle (EV) policies and internal disagreements regarding its marketing strategy.
Since “the government policies are not consistent and clear as of now,” this category is unreliable, according to HS Bhatia, MD of Kelwon Electronics and Appliances Pvt. Ltd, Daewoo’s sole manufacturing partner in India.
Bhatia highlighted the unpredictability surrounding the FAME II subsidies, which were anticipated to end in March but were unexpectedly extended. He emphasized the necessity for entrepreneurs and manufacturers to have a clear understanding of government policies for a minimum of two to three years, preferably five, to plan effectively.
These comments align with a recent announcement from the Ministry of Heavy Industries, introducing the Electric Mobility Promotion Scheme 2024 in mid-March. This initiative, with a budget of Rs 500 crore, aims to sustain subsidies for electric two- and three-wheelers for four months, from April 1 to July 31, following the conclusion of FAME II on March 31.
The new scheme guarantees benefits for electric two- and three-wheelers sold after the FAME II deadline. Initially launched in 2019, FAME II had a budget of Rs 10,000 crore over three years, ending in 2022, but received an extension to March 2024.
Additionally, FAME II’s budget saw an increase of Rs 1,500 crore last month. The government has stated that the subsidies will apply to vehicles sold by March 31 or until the allocated funds are depleted, whichever comes first. To date, the scheme has subsidized approximately 1.47 million electric vehicles, including 1.30 million two-wheelers, over 150,000 three-wheelers, and nearly 19,000 four-wheelers.
Daewoo, once a prominent name in India’s automotive scene from 1995 to 2003, unveiled a variety of consumer electronics and automotive products in New Delhi last October. These included lead-acid batteries, Daewoo-branded lubricants, and electric bicycles. The company’s executives also declared their intention to enter the e-mobility market with electric bicycles, scooters, and motorcycles.
Despite policy uncertainties, Bhatia mentioned that his company is exploring various technological avenues, such as in-house development or collaboration with established tech firms. He projected that it might take six months to a year before they launch their product line in this category.
