Shamsher Dewan
Vice President & Group Head - Corporate Ratings, ICRA Ltd
Shamsher Dewan
Vice President & Group Head - Corporate Ratings, ICRA Ltd
Electric buses likely to account for 8-10% of new bus sales by FY2025
Electric buses are expected to be at the forefront of India’s electrification drive, with the segment expected to witness healthy traction going forward. The traction in the e-bus segment is already visible over recent months, despite the overall stress in the public transportation segment due to the pandemic. Among the various schemes for spurring electrification in the country, FAME II is the flagship one, offering a capital subsidy of Rs. 35-55 lakh for e-buses procured under the Gross Cost Contract (GCC) model of operations. Accordingly, the GCC model has witnessed increased traction over the past two years, with many SRTUs opting for this route in order to reduce capital burden and technology risks. The model is currently evolving, and operators are looking at various measures in order to mitigate the risks prevalent in the model. Nevertheless, as the model matures, electric buses are expected to witness increased adoption going forward, aided by the favorable cost economics.
