State's new EV policy sends electric car demand vrooming into fast lane

It's been barely 20 days since the Telangana govt rolled out its new electric vehicles (EV) policy that offers a 100% exemption on road tax and registration fees, but demand for electric four-wheelers (E4W) has already hit the fast lane.

E4W sales, which hit a speed bump in mid-2023 after the EV exemption quota ran out, shifted to a higher gear and are back to accelerating again, report car makers. So much so that on Nov 20, automaker JSW MG Motor India handed over the keys of 101 EVs in Hyderabad alone, making it one of the highest deliveries in a single day apart from festive days like Dussehra and Dhanteras.

The Chinese car maker's average EV sales have vroomed 200% post the exemptions. For instance, its MG Comet saw a 182% rise in bookings when compared to the period before the new EV policy came into effect on Nov 18. MG ZS EV shot up 192%, and MG Windsor clocked a 227% jump, said Satinder Singh Bajwa, Chief Commercial Officer, JSW MG Motor India.

Sources at Tata Motors, whose Nexon EV was a runaway success before EV exemptions quota slammed the brakes on all E4W sales, said during April to Oct, the monthly average EV sales were in the range of 225-245 in the state.

It may be recalled that as part of the Telangana govt's 2020-2030 EV and energy storage policy, 5,000 E4Ws were eligible for tax breaks. After the quota got exhausted in March 2023, the govt extended it by another 2,000 and then an additional 1,000 by diverting part of the quota under taxi E4Ws and electric two-wheelers (E2Ws) to E4Ws, but this too ended in mid-2023, reducing E4W sales to a crawl.

Luxury carmaker Mercedes-Benz India too is upbeat about the turnaround in fortunes post the announcement of the new EV policy.

"We are seeing customer sentiment bouncing back with a strong EV sales uptick. This has resulted in an eight times increase in our current bookings for EVs in Telangana as compared to Aug," said Santosh Iyer, Managing Director & CEO, Mercedes-Benz India. "Telangana govt's decision to exempt EVs from road tax and registration is a step in the right direction and will help the state regain its position as a leader in driving India's EV transition for a decarbonised future."