Automakers in EV policy to face penalty for revenue target miss

AUTOMAKERS PARTICIPATING IN the electric vehicle (EV) manufacturing policy will need to meet prescribed revenue targets or face financial penalties, according to detailed guidelines released under the Scheme to Promote Manufacturing of Electric Passenger Cars in India (SPMEPCI).

- NITIN KUMAR

Companies approved under the scheme must generate a minimum revenue of ₹5,000 crore by the end of the fourth year and ₹7,500 crore by the end of the fifth year from the sale of eligible electric vehicles.

Failure to meet these targets will attract penalties ranging from 1% to 3% of the revenue shortfall. No penalty will be imposed if the shortfall is 5% or less. A 1% penalty applies if actual revenue falls between 50% and less than 95% of the target. If the performance lies between 25% and less than 50%, the penalty rises to 2%, and if it falls below 25%, a 3% penalty will be levied on the shortfall.