The country’s largest electric scooter manufacturer Ola Electric, according to government sources will be reimbursing its customers a total sum of almost Rs 130 crores that it charged them for their off-board chargers. As per the reports this information has come from a source in the government, that the company will be initiating this refund as a response to the probe that was launched by the Ministry of Heavy Industries back in February of this year.
An official from the government stated, “The Automotive Research Association of India (ARAI) will not be taking any further action against Ola Electric, as the company announced in its letter to ARAI dated April 30, 2023 that, on their own volition, they will reimburse the price (approximately Rs. 130 crore) of the off-board charger to all customers who have bought the off-board charger as an accessory when purchasing an Ola S1Pro model scooter from FY 2019-20 until March 30, 2023”.
Although Ola Electric has not officially commented on this revelation, the company’s founder and CEO, Bhavish Agarwal, touched on the subject during a recent media interaction. The CEO stated that the company would comply with the Government of India and resolve all issues as per the government’s orders.
Recently, four of the country’s largest electric two-wheeler manufacturers, namely Ola, Ather, TVS Motor, and Vida, came under the investigation of the Government of India for allegedly underpricing their electric two-wheelers to qualify for subsidies under the Faster Adoption & Manufacturing of Electric Vehicles (FAME) program. According to senior government officials, these EV automakers may have falsely claimed at least Rs 300 crores in incentives.
The Ministry of Heavy Industries launched an investigation after receiving a whistleblower complaint that these four companies fraudulently claimed subsidies totaling at least Rs 300 crore by invoicing essential components like the charger and proprietary software separately from the two-wheeler.
The government mandated the Automotive Research Association of India to conduct the probe in February of this year. The government is also looking at almost a dozen other electric two-wheeler producers separately for allegedly failing to satisfy localization commitments under the scheme.
Companies under the FAME program claimed a government subsidy by giving their buyers a discount of up to 40% off the retail value. This allowed companies to boost EV sales by lowering their price. A total of Rs 2,000 crore was set aside under the scheme’s Phase II to provide financial support for manufacturers of electric two-wheelers.
Phase-II of the FAME Scheme was approved by the government with a budget of Rs. 10,000 crore for a three-year term beginning on April 1, 2019. About 86 percent of the entire financial assistance was set aside for the Demand Incentive in order to boost the market for xEVs in the nation. This phase was introduced in an attempt to create demand by supporting 7000 e-Buses, 5 lakh e-3 Wheelers, 55000 e-4 Wheeler Passenger Cars (including Strong Hybrid), and 10 lakh e-2 Wheelers.
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