Electric 3-wheeler subsidies for FY25 halt as sales hit cap

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Subscribe to enjoy similar stories. New Delhi: The removal of a central government subsidy will likely make popular electric three-wheelers dearer for the rest of this fiscal, potentially disrupting their sales from manufacturers such as Bajaj Auto, Mahindra Last Mile Mobility and Piaggio, among others. The annual cap for number of subsidised e-three wheelers under the PM E-Drive scheme has almost been reached for this fiscal, and the Centre has decided not to extend the subsidies beyond the cap for FY25.

In a letter to OEMs (original equipment manufacturers) dated 8 November, the ministry of heavy industries (MHI) has written that once the scheme’s target is met, no additional e-three wheelers will be eligible for subsidies. Mint has seen a copy of the letter. The letter mentions that against a target of 80,546 units for FY25, 79,974 units of e-three wheelers—including e-rickshaws (for passengers) and e-carts (for goods transport)—had already been sold as of 7 November.

Also read | Bajaj's aggressive push threatens Ola's EV dominance as share slips below 30% The scheme will only be renewed next fiscal, but with a lower subsidy per vehicle. Currently, incentives of up to ₹50,000 can be availed per e-three-wheeler. That is set to halve to ₹25,000 per vehicle from 1 April 2025.

Emailed queries sent to the heavy industry ministry were unanswered till press time. Electric vehicle manufacturers expect the government’s decision to push up prices of these popular, environmentally friendly vehicles by about 15-18% of their ex-showroom price, which could dampen their sales momentum, leading industry executives Mint spoke to said. According to the industry, electric three-wheelers have been widely adopted in India as an