Budget Impact On EVs: Winners And Losers

Anyone looking to purchase an entry-level EV is set to be hit with the provisions announced in the budget of the upcoming fiscal year. Finance Minister Prakash Sharan Mahat on Monday presented a budget that laid out a slew of tight measures for entry-level EVs. As expected, Prime Minister Pushpa Kamal Dahal's administration slapped higher levies on electric cars between 50 to 100 kW making them expensive.Due to the massive increment in the prices of EVs above 100 kW in the outgoing fiscal, the sub-100 kW segment turned out to be a hotly-contested segment with numerous offerings in contention from several manufacturers. Manufacturers like Tata Motors, MG Motors, BYD and NETA changed the market dynamics of EVs with their attractive pricing. However, with the new budget, carmakers that are selling EVs between 50 to 100 kW peak power will face serious challenges.The government has added a 10 percent excise duty and 15 percent customs duty on EVs that came under this segment. Earlier, this segment attracted 10 percent customs duties only. As the government has increased the tax rate, the price of EVs will increase by Rs 5 Lakh to 10 Lakh, meaning the prices of Tata Nexon EV, BYD Atto 3 100 kW, MG ZS EV 99 kW, Hyundai Kona Electric 100 kW and NETA V will go up.On the other hand, the government has decreased the excise duty and customs duty to 20 percent each on EVs between 100 to 200 kW.  After the government reduced the tax rate on this segment, the price of Hyundai Ioniq 5 and Tesla cars will decrease substantially. The Ioniq 5 which is selling for Rs 1.16 crore will now come under a crore mark. Similarly, the price of Tesla cars will decrease by approximately Rs 15 Lakh - Rs 20 Lakh.Currently, BYD offers two variants of the Atto 3 - 100 kW and 150 kW. The price of the 100 kW variant will increase, while the price of 150 kW will decrease. Similarly, MG offers the ZS EV in both 99 kW and 125 kW versions. Tata Motors, on the other hand, offers the Nexon EV in two variants - Nexon EV Prime 95 kW and Nexon EV Max 99 kW. Tata's other EV, Tigor EV, comes with 55 kW peak power. Likewise, Hyundai offers the Kona electric in three trims - NS, GL and GLS. NETA Auto offers the Neta V in a single trim only.The electric Citroen eC3 which will be launched soon is positioned under the newly-created 50 kW segment.EVs that fall under the 50 kW segment attract a custom duty of 10 percent only. Hence, the eC3 which makes 42 kW will provide serious competition to EVs between 50 to 100 kW.