Impact of FAME subsidy withdrawal lingers, EV retails show modest recovery in May

Recovery of electric vehicle (EV) retail continued to be modest in May, largely due to the discontinuation of the FAME-II subsidy scheme, as per the latest data from the Federation of Automobile Dealers Associations (FADA). The apex body of automotive retail FADA has released the EV retail sales data for May 2024, indicating a slight pickup in EV retail across various segments. 

Notably, the FAME-II subsidy for EVs ended on March 31. "May 2024 has shown a slight recovery in EV retail across various segments following the major decline caused by the conclusion of FAME-II subsidies in March," Manish Raj Singhania, President of FADA said. However, he added, the market share for electric commercial vehicles, including two-wheelers and three-wheelers, has remained relatively stagnant over the past few months.

Source: FADA

A total of 76,907 units of electric two-wheelers were sold in the market last month, up 18.12% from April 2024. Ola Electric Technologies saw the highest sales at 37,225 units, followed by TVS Motor Company and Bajaj Auto Group at 11,788 units and 9,214 units, respectively. 

On the outlook, the FADA President said the automotive industry is eagerly looking forward to the announcement of FAME-III by the newly formed government. "We believe that the introduction of new subsidies and incentives under FAME 3 will provide the necessary boost to EV sales and help increase their market share significantly. FADA remains committed to supporting this transition and looks forward to collaborating with all stakeholders to drive the growth of sustainable mobility solutions in India," he added. 

Source: FADA

In the electric passenger vehicle segment too, sales grew by 3% sequentially to 7,638 units in May as compared with 7,415 units in April. However, on a YoY basis, it declined by 1.24% against 7,734 units in May last year. Tata Motors continues to lead the market with 5,038 units, though less as compared to 6,018 units the same month a year ago.

Source: FADA

In the electric three-wheeler segment, there was a MoM growth of 30% to 54,729 units against 42,030 units, and electric commercial vehicles too increased by 8% MoM to only 551 units as compared to 510 units in April this year.