Tata Motors, Mahindra, and Ola Electric are eying a bonanza as they take the lead in availing benefits under the government’s production-linked incentive (PLI) programme. These sops are a sweetener for the three already benefiting from the ongoing Faster Adoption & Manufacturing of Electric Vehicles in India (FAME India) scheme, valid till March 2024.
Two officials aware of the programme implementation confirmed to ET that these companies stand to gain from both the Auto PLI sops and FAME-II incentives. “Eligible sales made till March 2024 will be subsidised under FAME-II as well,” the officials said.
Besides Auto PLI, the Heavy Industries Ministry is also running the FAME-II scheme which offers a Demand Incentive for EVs in the country by subsidising sales. Effectively, certain models of these three companies are eligible for sops to manufacture and sell the same vehicle.
According to Additional Secretary, Ministry of Heavy Industries, Hanif Qureshi, four-wheeler makers Tata Motors and Mahindra got certificates under auto PLI earlier in 2024, while two-wheeler maker Ola Electric received approvals in the first fortnight of February,
“Disbursals under the Auto PLI are linked to the sale volumes,” Qureshi told journalists on Monday, adding that any one company can corner up to 25% of the total scheme layout of Rs 25,938 crore. The scheme implementation hinges on Domestic Value addition (DVA) certification from testing agencies that endorse the localisation levels in these vehicles.
“PLI sops can be claimed against sale of eligible vehicles after the DVA certification,” he said.
Mahindra & Mahindra, Tata Motors, and Ola Electric have already received DVA certificates for 22 variants of Advanced Automotive Technology (AAT) products. Mahindra & Mahindra is the first company to meet the DVA criteria in Three-Wheeler category, while Tata Motors is the first to meet the DVA criteria for both Four-Wheeler and Bus categories.
The Auto PLI scheme supports the manufacturing of locally made electric vehicles by offering a PLI to the original equipment manufacturers (OEM) when sales occur. Auto PLI aims to facilitate and promote deep localization for AAT Products such as Zero Emission Vehicles (ZEVs) – Battery Electric Vehicle and Hydrogen Fuel Cell Vehicle.
The incentive under Auto PLI scheme is applicable for five years from fiscal 2022-23 and the disbursement is applicable in the subsequent financial year.
