MHI suggests Rs 10,000/kWh subsidy for e-Trucks, seeks industry feedback
ECONOMY & POLICY

MHI suggests Rs 10,000/kWh subsidy for e-Trucks, seeks industry feedback

The PM E-DRIVE (Electric Drive Revolution in Innovative Vehicle Enhancement) website indicates that the eligibility criteria for e-trucks are being finalised and will be announced soon. Additionally, the crucial aspect of incentive levels may also be notified shortly. The Ministry of Heavy Industries (MHI) has proposed an incentive of Rs 10,000 per kWh for medium and heavy-duty electric trucks (M&HDT).

Three levels of subsidies have been listed: Rs 10,000 per kWh, Rs 15,000 per kWh, and Rs 20,000 per kWh. This range of subsidies is expected to reduce the upfront cost of electric trucks by 20% to 40%, with total cost of ownership (TCO) decreasing by 11% to 29%.

With the moderate subsidy level of Rs 10,000 per kWh, the proposed cap for e-truck subsidies is set at Rs 8 lakh for vehicles in the 3.5 to 7.5-tonne category, and INR 15 lakh for e-trucks exceeding this tonnage up to 12 tonnes, categorised as N2 (Medium Duty Truck) vehicles. For N3 Rigid Trucks (Heavy Duty Trucks), the incentive cap is Rs 2 million for trucks weighing 12 to 25 tonnes, and Rs 3 million for e-trucks over 25 tonnes. For N3 Tractor Trailer (HDT) e-trucks exceeding 35 tonnes, the proposed cap on incentives is Rs 4 million.

Uday Narang, Chairman of Omega Seiki Mobility, expressed his satisfaction that the electric truck segment is finally being considered for incentives. He mentioned that he would like to learn more details about the process and timeline for the subsidy payment. His company, currently active in the electric three-wheeler market, plans to enter the medium-duty truck market with a 3.5-tonner and a 7-tonne, with the launch of its first electric small truck, a 1.0/1.5-tonner, scheduled for December this year.

It is estimated that the Rs 5 billion allocated for electrification in the M&HCV segment will support the adoption of 1,975 e-trucks under the Rs 10,000 per kWh subsidy scenario. If the subsidy level is set at Rs 15,000 per kWh, it is expected to support 1,342 e-trucks, and 1,014 e-trucks will receive support under the Rs 20,000 per kWh subsidy level. MHI proposes the Rs 10,000 per kWh subsidy level as it would incentivize a larger number of electric trucks. The note states that this approach would significantly bridge the TCO gap between electric and diesel trucks across different segments and support a greater number of trucks for deployment.

The PM E-DRIVE (Electric Drive Revolution in Innovative Vehicle Enhancement) website indicates that the eligibility criteria for e-trucks are being finalised and will be announced soon. Additionally, the crucial aspect of incentive levels may also be notified shortly. The Ministry of Heavy Industries (MHI) has proposed an incentive of Rs 10,000 per kWh for medium and heavy-duty electric trucks (M&HDT). Three levels of subsidies have been listed: Rs 10,000 per kWh, Rs 15,000 per kWh, and Rs 20,000 per kWh. This range of subsidies is expected to reduce the upfront cost of electric trucks by 20% to 40%, with total cost of ownership (TCO) decreasing by 11% to 29%. With the moderate subsidy level of Rs 10,000 per kWh, the proposed cap for e-truck subsidies is set at Rs 8 lakh for vehicles in the 3.5 to 7.5-tonne category, and INR 15 lakh for e-trucks exceeding this tonnage up to 12 tonnes, categorised as N2 (Medium Duty Truck) vehicles. For N3 Rigid Trucks (Heavy Duty Trucks), the incentive cap is Rs 2 million for trucks weighing 12 to 25 tonnes, and Rs 3 million for e-trucks over 25 tonnes. For N3 Tractor Trailer (HDT) e-trucks exceeding 35 tonnes, the proposed cap on incentives is Rs 4 million. Uday Narang, Chairman of Omega Seiki Mobility, expressed his satisfaction that the electric truck segment is finally being considered for incentives. He mentioned that he would like to learn more details about the process and timeline for the subsidy payment. His company, currently active in the electric three-wheeler market, plans to enter the medium-duty truck market with a 3.5-tonner and a 7-tonne, with the launch of its first electric small truck, a 1.0/1.5-tonner, scheduled for December this year. It is estimated that the Rs 5 billion allocated for electrification in the M&HCV segment will support the adoption of 1,975 e-trucks under the Rs 10,000 per kWh subsidy scenario. If the subsidy level is set at Rs 15,000 per kWh, it is expected to support 1,342 e-trucks, and 1,014 e-trucks will receive support under the Rs 20,000 per kWh subsidy level. MHI proposes the Rs 10,000 per kWh subsidy level as it would incentivize a larger number of electric trucks. The note states that this approach would significantly bridge the TCO gap between electric and diesel trucks across different segments and support a greater number of trucks for deployment.

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