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Union Budget 2024 is likely to have a big impact on the two-wheeler industry. The government has reduced customs duties on important minerals for battery manufacturing. However, there are no updates on restoring or increasing subsidies for electric two-wheelers.
Let’s know about the key highlights of Union Budget 2024:
In the 2024 budget, the government hasn't provided significant relief for the auto industry or EV subsidies. There's also no major update on renewing old schemes. The auto industry had high hopes for EV-related support.
However, there is a relief that customs duties on lithium, copper, and cobalt have been reduced from 10% to 2.5%. This will lower battery prices by up to 20%, leading to cheaper electric vehicles.
Currently, EV subsidies are given under the EMPS scheme, which will run until July 31, 2024, benefiting up to 3.72 lakh vehicles.
The subsidy amount for FY 2025 has been reduced to Rs 2671 crore from Rs 5172 crore in FY 2024. The government announced that 3.72 lakh electric vehicles will benefit from the Electric Mobility Promotion Scheme (EMPS) between April and July.
To promote green mobility, the government has allocated Rs. 493.55 crore to subsidize 3.72 lakh EVs. According to the Ministry of Heavy Industries, the EMPS 2024 aims to support green mobility and will benefit a maximum of 3,72,215 EVs, including:
The two-wheeler industry is expected to continue growing steadily, with a projected growth rate of 7-9% in FY25. This follows a strong growth of 9.8% in FY24. Hero MotoCorp and TVS Motor Company saw their share prices rise by 1-3%. Moreover, the Hero MotoCorp is leading the gains in Nifty-50 stocks.
Before you go, don’t forget to check out the upcoming Kawasaki Hydrogen bike prototype.
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