FAME II Policy and EV Manufacturers: India’s Auto Giants to refund EV Overcharges, Ola, TVS, Ather, and Hero Take Responsibility
India’s FAME II policy was established to promote the adoption of electric vehicles in the country. Under the policy, eligible electric vehicles were provided with benefits and subsidies to incentivize the purchase and use of EVs.
However, the policy set a limit on the retail price of electric two-wheelers that could qualify for these benefits. Two-wheelers priced above INR 1.50 lakh per unit were excluded from receiving these benefits to ensure that the programme’s benefits are targeted towards affordable EVs accessible to a larger section of society.
Manufacturers, however, found ways to sidestep this caveat by selling electric scooters within the price range and selling necessary chargers and proprietary software separately. To address this, the Ministry of Heavy Industries stopped subsidies to all manufacturers that didn’t comply with the FAME II guidelines. In response, some EV manufacturers have taken corrective steps to repay customers who have been overcharged.
Ola Electric, TVS Motor, Ather Energy, and Hero MotoCorp Set Example with Refunds
Ola Electric has announced a refund of INR 130 crore to S1 Pro customers who purchased the vehicle before March 30, 2023. Similarly, TVS Motor has agreed to refund customers who paid more than the threshold limit set by FAME II. The total refund cost for the company is estimated to be less than INR 20 crore, and it will be paid to customers who bought the TVS iQube S model between May 2022 to March 2023. An ET AUTO report pegs the total refund amount at Rs 15.61 crore. This will be repaid to 87k customers. Hero MotoCorp will refund 1,100 Vida V1 Plus and V1 Pro customers who purchased the vehicle before March 2023.
Official statement. pic.twitter.com/MKtMfGREMe
— Ather Energy (@atherenergy) May 4, 2023
Ather’s dues stand at INR 140 crore to be repaid to 95,000 customers who purchased the Ather 450x e2W until April 12, 2023. Additionally, a further recovery of INR 25 crore will be made from Ather on account of reduced battery capacity scooters for those who didn’t buy upgraded software. With these corrective steps, EV manufacturers aim to rebuild trust with their customers and promote the adoption of electric vehicles in India.
Important Update. pic.twitter.com/G0GM46UApM
— Ola Electric (@OlaElectric) May 4, 2023
TVS Motor said – “TVS Motor is fully committed to the Government of India’s vision to promote electric mobility and fully support the Government of India’s initiative to enable faster adoption of electric mobility, development of electric vehicle eco-system and in spirit of Atmanirbhar Bharat, all the electric development has happened in house. Additionally, as a responsible corporate, TVS Motor has fully complied with all government regulations specified under FAME. Further towards alleviating ambiguity and ensuring a clear policy direction, TVS Motor will offer a goodwill benefit scheme for its customers who have paid over and above the threshold limit fixed by FAME. The overall cost impact to TVS Motor Company is less than 20 crores.”
EV Manufacturers Take Corrective Steps to Repay Customers for Overcharging
The refund announcements by EV manufacturers are significant steps towards promoting customer trust and transparency in the EV ecosystem. This move by manufacturers will help restore consumer confidence in the EV industry and encourage wider adoption of electric vehicles.
The FAME II policy’s guidelines are designed to make EVs more accessible to a larger section of society by targeting benefits towards affordable electric two-wheelers. Manufacturers must comply with these guidelines to qualify for benefits and subsidies, which will further promote the adoption of EVs in India. The corrective measures taken by EV manufacturers also highlight the importance of regulatory oversight and enforcement to promote a fair and transparent market for EVs.
