Whalesbook
1. THE SEAMLESS LINK
Manufacturers of electric motorcycles are actively seeking government intervention, arguing that the current policy landscape fails to adequately support their segment. While schemes like FAME-II and the PM E-DRIVE initiative have predominantly benefited electric scooters and three-wheelers, the electric motorcycle sector finds itself under-supported. This disparity is becoming a critical concern as companies look towards the upcoming Union Budget for potential relief and growth impetus.
The Motorcycle Market's Dominance
Industry figures emphasize that motorcycles constitute a substantial portion of India's two-wheeler market, representing approximately 70% of internal combustion engine (ICE) sales, compared to scooters' 30%. Anjali Rattan, Chairperson of Revolt Electric Motorcycles, stated that prematurely withdrawing any existing subsidies could significantly impede adoption rates within this core segment. She advocated for prioritizing subsidies for electric bikes to foster market penetration that aligns with realistic expectations, suggesting that this focus is crucial for the overall transition of India's largest two-wheeler category. The market for electric two-wheelers, in general, saw retail volumes grow by 32.8% year-on-year in December 2025, reaching 97,744 units, though overall penetration remained stable at 6-7% during the first nine months of fiscal year 2026.
Calls for Comprehensive Support Measures
Beyond direct subsidies, manufacturers are proposing a range of interventions. Mohal Lalbhai, Founder of Matter, suggested that incentives could encompass research and development (R&D) support, which is vital for indigenous innovation and developing electric motorcycles that meet global performance standards. Matter itself is planning to expand its product offerings across five two-wheeler segments by 2030, including its existing electric motorcycle, the Aera. Other proposals include demand-side incentives similar to Production-Linked Incentives (PLI) schemes. The EV sector is broadly calling for structural reforms, including tax rationalization on raw materials and finished vehicles, and enhanced support for domestic manufacturing, as articulated by industry leaders like Madhumita Agrawal of Oben Electric.
Established Players and Future Strategies
While niche players like Matter, Revolt Motors, Ola Electric, and Oben Electric are active in the electric motorcycle space, major established manufacturers are also making strategic moves. Hero MotoCorp has patented the Vida VXZ electric motorcycle, developed in collaboration with Zero Motorcycles, signaling a move towards higher-margin segments with launches anticipated between 2026 and 2027. Bajaj Auto is developing an all-new, in-house electric motorcycle platform to cater to various segments, from commuters to high-performance machines. TVS Motor Company is also expanding its electric two-wheeler portfolio, though its current focus appears to be on scooters like the iQube and the upcoming TVS X, with plans for a wider range of electric two-wheelers over the next year. The overall two-wheeler industry is projected to grow by 6-9% in FY2026, supported by GST rate cuts and improved demand conditions. However, electric motorcycles currently hold a modest market share, estimated at around 5.4% of the total two-wheeler ecosystem in 2025.
Industry Outlook and Budgetary Expectations
The industry is optimistic that the upcoming budget will address these demands. Representations have been made to the government, which has reportedly taken note, leading to hopes of concrete announcements. The broader Indian EV industry is advocating for policy continuity and structural reforms, including tax rationalization and consistent support for domestic manufacturing, to achieve national electrification targets by 2030 and foster a self-reliant EV ecosystem. The recent GST 2.0 implementation has provided some affordability improvements, and the sector is looking for sustained policy support to navigate global supply-chain volatilities and drive mass adoption.