A chicken-or-egg-first drawback has developed within the nation’s electrical truck business with the federal government pushing producers to adjust to an bold localisation plan, whereas e-truck makers demur on indigenisation given issues over tepid demand.
Two individuals conscious of current consultations between the Union heavy industries ministry and e-truck makers corresponding to Tata Motors, Ashok Leyland, Volvo Eicher Industrial Automobiles, and Murugappa-group’s IPLTech, amongst others, mentioned that the federal government had requested the producers to adjust to the localisation standards in consultations earlier in October.
A phased manufacturing programme (PMP) for e-trucks unveiled in July as a part of the ₹10,900-crore PM E-Drive scheme set deadlines for elements that e-truck makers could be allowed to import. Most such merchandise and elements are imported from China at present.
It listed merchandise and elements corresponding to an HVAC system (heating, air flow, and air con), electrical compressors for brakes, charging inlets for normal EV chargers, a battery administration system, a automobile management unit, and traction motors, amongst others. The cutoff date for the import of most of those elements was 1 September 2025, with imports of some being allowed until 1 March 2026.
One current rest was when the federal government allowed e-truck makers to import traction motors with uncommon earth magnets from Chinese language suppliers within the wake of the uncommon earth magnet provide minimize from China.
The PM E-Drive scheme for e-trucks and e-buses has been prolonged by two years until FY28 in August this yr, only some months earlier than it was set to lapse as funds for these two automobile segments had not been utilised.
The ₹10,900 crore help within the scheme is earmarked for subsidies on buy of electrical two-wheelers, three-wheelers, e-buses, e-trucks, electrical and hybrid ambulances, and charging infrastructure. E-buses made up about 40% of the allocation.
Testing delays
In the meantime, even after greater than two months because the tips for e-trucks had been introduced, no e-truck mannequin has handed the localisation check as of date, mentioned one of many individuals above, requesting anonymity. This means the shift to localisation is gradual.
“The federal government has requested e-truck makers to expedite the testing course of,” mentioned the primary individual cited above. The testing will present what native components are utilized in e-trucks and e-buses.
That is regardless of Indian auto elements makers starting to make essential components domestically. Corporations corresponding to Sona Comstar (listed on the exchanges as Sona BLW Precision Forgings Ltd) are making traction motors and Toyota Kirloskar Auto Components Ltd is planning to make trans-axles for EVs indigenously. These two merchandise, as additionally just a few others, are included within the authorities’s ₹25,938-crore production-linked incentive scheme for vehicles and auto components, the place localisation standards name for 50% of spare components and uncooked supplies to be sourced in India.
E-truck makers cite uncertainty in demand for the gradual switchover to native elements whereas the federal government has countered that firms utilizing vans in sectors corresponding to ports, metal, and cement have proven intent to transition to inexperienced logistics, in keeping with the second individual talked about above, who additionally requested anonymity.
Electronic mail queries despatched to the heavy industries ministry, in addition to truck makers Tata Motors, Ashok Leyland, IPLTech, and Volvo Eicher Industrial Automobile remained unanswered.
Shifting to e-trucks is pricey for companies as these are 20% to 50% pricier than diesel fashions, in keeping with area specialists. The expansion in gross sales of so-called N2 and N3 e-trucks is at a wholesome 27.5% between fiscal 2025 and the earlier fiscal yr however the underlying numbers are very small: 301 e-trucks had been offered in India in fiscal 2025, lower than 0.1% of the variety of diesel vans offered within the yr. (N2 vans have gross automobile weight of three.5 to 12 tonnes and the larger N3 variants vary from 12 to 55 tonnes.)
Indigenising e-truck making for native producers turns into viable solely with a much bigger demand, an professional mentioned. E-truck makers have a fancy effort forward of them in “vendor administration not solely at Tier 1 but in addition Tier 2 and Tier 3 ranges,” mentioned Sharif Qamar, affiliate director for transport and concrete governance at The Vitality and Sources Institute. “Until they’ve the required scale and demand for his or her merchandise, utilizing costly native elements can impression their margins.”
