Local electric two wheeler makers are going to bear the brunt of dumping of products from China. Earlier it was Radial tyres that bore the brunt. Electric two-wheelers make up a very small portion of the total two-wheeler market in India.
 
Organized sector players sold over 84 lakh two-wheelers of which only 1.1 lakh were electric scooters. The industry experts say that the segment could grow to around 10% of the pie over the next 2-3 years from just over 1.3% today. The vast unorganized market acquires electric scooters from China and dumps them in India at much lower prices. This apparently is throttling growth.

Mr. Sohinder Gill, director (corporate affairs) of the Society of Manufacturers of Electric Vehicles and CEO of Hero Electric, blames the inverted duty structure, which gives importers of Chinese electric scooters an edge over local manufacturers.

He said “Currently, there are only six organized players in this market and another six will start operations in the next two months. Already, our share in the total two-wheeler market is negligible and our customs duty structure only makes matters worse. There is 0% duty if you import the complete vehicle and on the import of critical parts there is a 10% extra countervailing duty."

He added "Growth of 10% in the next 2-3 years is possible only if the rapid charging facility, which can charge the scooter in 15 minutes, is set up. The cost of such stations is Rs 3-5 lakh. Until then, the threat from China's vast electric two-wheeler market will continue to eat up the already negligible share of the organized players."

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Posted by Amrith K.A on 4 May, 2009 5:12:39 PM IST #