A Bengaluru-based electric bike start-up has launched a high-power motorcycle this week, priced on par with 300cc petrol-powered bikes. This breaks the misnomer that electric vehicles (EVs) will always be priced at a premium over their petrol counterparts.
The all-electric Ultraviolette F77 priced at Rs 3 lakh hits a top speed of 147 km per hour while the BMW G310 GS priced at Rs 2.99 lakh has a top speed of 143 km per hour.
Will this change the way buyers look at EVs given that a part of the price will contain government subsidy? What if the incentives are to be reduced over time as China has done?
More on this later in the copy but here is a complete round-up of all the important headlines in the auto space this week.
Honda launches the first motorcycle with BS-VI tech
Honda Motorcycle and Scooter India (HMSI) on November 14 launched a new BS VI-compliant bike SP 125 with price starting at Rs 72,900 (ex-showroom Delhi).
The new bike replaces the company’s 125cc model CB Shine SP. The Japanese two-wheeler major would, however, continue to sell BS-IV CB Shine in the market.
Bajaj-Triumph bike to be ready in 2022
It will take at least two years for the commercial launch of the first of several mid-capacity bikes that Triumph and Bajaj Auto are planning for India and global markets.
The two companies, who have been in talks for over two years now, are expecting to sign a much-delayed formal agreement in December, a senior Triumph official told Moneycontrol on the sidelines of the EICMA event
Honda’s Manesar unit hit by strike
Honda’s oldest manufacturing plant based in Manesar, Haryana has suspended production following allegations of misconduct by workers and a week-long tool down strike.
More than 2,000 contractual workers have participated in the strike against the retrenchment of over 200 contract workers at the factory. The slowdown in retail demand had forced Honda, the second-largest two-wheeler company in India, to cut back on production and lay off surplus manpower.
Ultraviolette launches e-bike at Rs 3 lakh
Indian startup Ultraviolette on November 13 unveiled F77 – its first electric motorcycle. The F77, unlike the Revolt RV400, is more in the mould of a sports bike. Launched in three variants, the bike is priced between Rs 3 lakh and Rs 3.25 lakh.
Tata Group approaches BMW and Geely
Tata Group has approached Germany’s BMW AG and China’s Zhejiang Geely Holding Group Co. to partner for its Jaguar Land Rover auto business, Bloomberg reported.
The company is looking for partners to save cost and share the burden of investments towards EVs and may approach other potential partners depending on Geely and BMW’s responsiveness, the sources added
Bajaj Chetak to become base for KTM scooters
Bajaj Auto’s first EV Chetak will also become the product base for scooters from KTM and Husqvarna brands, and these will be manufactured in India.
Bajaj has a decades-old alliance with Austrian off-road bike specialist KTM which in turn owns brand Husqvarna. While KTM bikes are made and sold in India, Husqvarnas will follow suit in a few months
Electric two-wheeler sales crash under FAME – II
The gradual phase-out of government-backed incentives for EVs in China had consequences as sales of electric and hybrid vehicles fell 34 percent in September. Subsidies were cut by more than 50 percent.
Though China started incentivising EVs way before India, the FAME-I (Faster Adoption and Manufacturing of Electric and Hybrid Vehicles) scheme started handing out incentives only in 2015.
Understanding the long term financial repercussions of perennially subsidising EVs the Indian government was quick to do a course correction.
Under FAME-II scheme the subsidies are given to only those vehicles which fulfilled manufacturing and pricing criteria stipulated by the government. Thus only those models which sourced at least 50 percent of parts locally are eligible for a subsidy.
Incentives are also given on the basis of the battery pack used in EVs. For instance, a 1 kW battery pack will get a subsidy of Rs 10,000 and 2 kW battery pack will get Rs 20,000 subsidy. Incentives will be given only to those vehicles which use lithium-ion batteries.
As most electric two-wheelers were powered by cheaper, old generation lead-acid batteries the incentives were denied to them. This led to a freefall in demand but the industry was not complaining since most manufacturers had already planned a shift to lithium technology.
Because of the minimum 50 percent local procurement clause, cheaper imports from China also took a hit.
“Data from industry shows that sales of high-speed electric two-wheelers fell to 3,000 in six months this year from 2,000 per month under FAME I,” a senior executive of Bajaj Auto said. Bajaj will commercially launch Chetak in January. It will be made at Pune.
Nearly 49,000 units were sold in the same first six months of last year as per data released by the apex lobby body Society of Manufacturers of Electric Vehicles (SMEV).
High-speed electric two-wheelers cost upwards of Rs 80,000. The Chetak will be priced in the price band of Rs 1-1.5 lakh. Models of Bengaluru-based, Hero Motocorp-backed start-up Ather are also priced upwards of Rs 1 lakh. Ultraviolette’s F77 bike is priced at Rs 3 lakh.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.
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