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Electric vehicles sales in India witness sharp decline of 14% in June

The electric vehicle (EV) sales in India witnessed a sharp decline of 14% in June against May. This is likely due to the changes in government policies and people’s increasing interest towards hybrid vehicles.

According to Vahan data from the Ministry of Road Transport and Highways, EV sales in June 2024 fell by more than 14% to 1,06,081 units, compared to 1,23,704 units sold in May. It was the lowest sales figure in this calendar year.

However, in June, the sales were over 20% higher compared to the same month last year, when the sales had dropped due to government tweaks in subsidies.

So far this year, around 8,39,545 electric vehicles have been sold, accounting for approximately 6.69% of total vehicle sales.

For the EVs, June has been the worst-performing month for this year as well as the last year. However, on a year-on-year basis, June 2024 saw a big improvement, with 1,23,704 units registered, marking a 20.52% increase compared to the 1,02,645 units registered in June 2023.

Last year, EV sales declined due to the Centre’s decision to reduce the maximum subsidy for electric two-wheelers (e2Ws) from approximately Rs 60,000 to around Rs 22,500. This move led to an increase of more than 20 per cent in the average price of an e2W, which typically ranges from Rs 80,000 to Rs 1,50,000.

Two-wheelers EVs account for 57% of the 8,39,545 electric vehicles sold overall in 2024. Changes in e2W sales significantly impact the overall sales of the EV category.

The government further reduced the subsidy by half in April with the introduction of the Rs 500 crore Electric Mobility Promotion Scheme 2024 (EMPS 2024).

Under EMPS 2024, the subsidy cap for electric two-wheelers (e2Ws) is now Rs 10,000 per vehicle, down from Rs 22,500, while for electric three-wheelers (e3Ws), it has been reduced to Rs 50,000 from Rs 1,11,505. Both categories will receive incentives of Rs 5,000 per kilowatt-hour (kWh).