Indian Govt Ramps Up EV Incentives, Australian Buyers Still Go Without Photo:
Trevor Collett | May, 07 2015 | 4 Comments

India is the latest country to offer incentives to buyers of electric vehicles, under a scheme that cuts up to AU$2700 from an EV’s purchase price.

Called the ‘Faster Adoption and Manufacturing of Electric vehicles’ program (FAME), the scheme targets cars along with electric motorcycles and scooters, buses and light commercials.

Around $570 can be cut from the price of an electric motorcycle under the program, while hybrids also qualify for some government money.

While a maximum AU$2700 saving might not seem generous, some EVs on sale in India could see their prices slashed by well over 10 percent.

The Mahindra e2o (pictured above) is one such model, which carries a retail price of around 571,000 rupees (AU$11,216).

While the e2o is an entry-level model, it still features the likes of a touchscreen with sat-nav, a mobile phone app to remotely lock or unlock the vehicle or to set the climate control and a reversing camera.

The e2o’s battery is fully charged in around five hours, although a fast charger can get the job done in one hour, and the car can achieve around 120km between charges with a top speed of 88km/h.

FAME is scheduled to remain in place until the end of March 2017, or until the program’s allocated budget is exhausted.

And it isn’t the only plan the Indian Government has for reducing the country’s emissions levels, with new Corporate Average Fuel Consumption (CAFC) laws set to force carmakers to reach an ‘average’ fuel economy across their entire range - similar to the US scheme.

The impact of CAFC laws will likely be immediate and widespread, as the government is demanding a steep 14 percent improvement in fuel consumption starting next year.

This is likely to result in immediate action from Indian carmakers, who will either shift the focus of their model ranges or look to improve fuel consumption, while models exported to markets such as Australia may also benefit.

India has seen a raft of EV incentive schemes come and go over the last five years, including state-based schemes and subsidies for carmakers to build EVs, along with reduced registration fees and taxes.



While many western markets boast a range of government incentives, and others like India and China are now rapidly making progress in the same space, Australian governments in the main have yet to climb aboard.

The absence of any genuine financial incentive to choose an EV is a major obstacle to growth of electric vehicle sales here.

Although EVs promise a lower 'total cost' of ownership, the higher cost of battery technology means that without incentives, the cost of entry for buyers is often prohibitively expensive.

“The Australian consumer tends to be quite pragmatic,” Holden's Peter Keley told TMR recently, while discussing the high cost and small uptake of the Holden Volt.

“They have a ‘show me’ atttitude. If I’m going to spend ‘X’ thousands of dollars more to obtain this technology to lower fuel consumption and running costs etc, there needs to be a pragmatic business case for me as a consumer."

“Until we can change the fundamentals of the cost equation, that will remain so," he added.

Nissan boss Richard Emery takes a different view: incentives are helpful, but it's the lack of government support for EV infrustructure that represents the greater impediment.

“It’s not registration (incentives) that stops people from buying them, it’s the fact that if they’re travelling around and stopping at shopping centres, or stopping at airports, or stopping in the city, they can’t find anywhere to charge their cars."

“So it’s actually infrastructure,” he said.

Speaking with TMR last year, Mr Emery said that carmakers must work to meet the changing needs of the market, but that government also has a role to play.

“If our country wants to be serious about lowering CO2, and cars have a role to play in that, we’re actively doing our bit but the government needs to do more,” he said.

The Australian Capital Territory offers a token incentive to EV buyers, which sees such vehicles (along with LPG- and natural gas-powered cars) afforded a 20 percent discount on government registration fees - but not on road levies or compulsory third party insurance.

In Victoria, electric vehicles and hybrids benefit from a $100 reduction of their annual registration cost.

As a selling point for its Model S sedan Tesla Motors also notes that "the Luxury Car Tax threshold for a fuel efficient vehicle is A$75,375, compared to AU$60,136 for a conventional vehicle".

Otherwise, some councils offer free charging stations for electric vehicles along with cheaper (or free) parking. But that’s about it.

Tesla also offers free charging through its Superchargers for its Australian customers, but this program is not directly subsidised in any way at a government level.

Holden recently pulled the pin on its Volt range-extended hybrid in Australia, owing mainly to the fact that General Motors has no plans at this stage for right-hand-drive production.

However, a $59,990 plus on-roads price-tag and a sales-tally of less than 300 over three years may have made for a difficult business case for a new model, and Holden may instead look to the smaller (and cheaper) Bolt EV - if the new model is built in RHD.

The local carmaker said the Volt’s purchase equation for the consumer didn’t stack up, and that cheaper fuel, a lack of government support and a lack of interest from the public were all factors.

Sales of Nissan's all-electric Leaf in 2015 are down 12.5 percent on the same time last year with 49 units sold as of the end of April.

Nissan Leaf
Nissan Leaf

Besides Tesla and Nissan, Australian EV buyers looking for all-electric motoring can choose from the Mitsubishi i-Miev or BMW i3.

Plug-in hybrid models also offer limited emissions-free driving, including the incoming Audi A3 E-tron, BMW’s i3 (the REX version) and i8 along with Mitsubishi’s Outlander PHEV.

“Full-electric vehicles are taking their time to get established in Australia for reasons of infrastructure," Nissan Australia boss Richard Emery said. "But we’ll hang in there."

MORE: Australia Hostile to Hybrids and EVs: Holden
MORE: Government Needs To Do More: Nissan
MORE: EV And PHEV Demand Varies Dramatically
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