The Ministry of Road Transport and Highways on Wednesday clarified that automobile makers could at their discretion sell electric vehicles without batteries. The batteries could be sold separately to the vehicle owner, or the owner could buy the battery from some other service provider.
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Government sources said the rationale behind the move was to make electric vehicles more affordable as the battery cost was 30-40 percent of the total cost. But the clarification has left India’s automobile industry confused.
"With BS-VI norms, manufacturers are responsible if a vehicle picked up at random from dealerships isn't compliant," said Rajiv Bajaj, MD, Bajaj Auto.
"Here a customer can buy a battery-less chetak or iqube and put anything into it. Battery life, charging time, reliability, range speed, gradeability be dammed!" he said.
Mahesh Babu, CEO of Mahindra Electric, has raised a similar concern.
"Up to the sale of the vehicle, the OEM (original equipment maker) is responsible for the safety of the vehicle. A vehicle that is tested, manufactured, and sold is an integrated vehicle and the OEM is responsible for the warranty," he said.
“No country in the world allows registration of EV’s without battery," he said.
"We will explain to the government that this notification has created confusion," Babu said, adding that the move did not appear to be well thought out as the industry was not consulted.
Also, the tax rates for an electric vehicle and battery are different, adding to the confusion.
“This is a great, futuristic idea and we welcome it, but a lot of confusion has cropped up," said Sohinder Singh Gill, Global CEO of Hero Electric and Spokesperson for Society of Manufacturers of Electric Vehicles .
"There is confusion about whether the GST on battery sold separately be 18 percent or 5 percent and whether a vehicle sold without a battery be eligible for FAME subsidy," Gill said.
Gill sees many clarifications having to be issued before the rule can be implemented.
: Explained: Transport ministry's clarification on batteries of new electric vehicles being sold separately
The road transport ministry's move is also aimed at encouraging the battery swapping technology, say sources. In battery swapping, the vehicle owner swaps the discharged battery for a fully charged one at the charging station.
"The EV battery swapping market is at its initial stages, globally, but this will change soon given the entry of several industry players such as NIO Inc., Gogoro Inc., Leo Motors Inc., SUN Mobility Private Limited, BattSwap Inc., Kwang Yang Motor Co. Ltd. (KYMCO), Panasonic Corporation, and Lithion Power Private Limited," said Akshima Ghate, Director, RMI, India.
"Taiwan has witnessed a significant penetration of battery swapping models since 2015; electric scooters with battery swapping accounted for nearly 15 percent of the total scooter market in 2019. Given the benefits of swapping in the two- and three-wheeler segments, it could be a crucial opportunity for industry players to deploy and test this technology at a larger scale through collaborative models," she said.
According to Ampere Electric Vehicles, the government's move to allow sale and registration of electric vehicles without batteries is encouraging.
"This will reduce the cost of acquisition of EV especially for two and three-wheelers and allow more and more people to shift from traditional to a more sustainable and affordable green mobility solutions for last mile connectivity. With increased pollution levels due to rapid rise in vehicles on the road, clean and environment-friendly mobility solutions like EV are the need of hour and this conducive policy will further strengthen the EV ecosystem," the company said in a statement.
First Published: IST