Price cap, certificate crunch stall Centre's e-truck drive

The Centre's PM E-Drive scheme for electric trucks, notified this month for the N2 (weighing 3.5-12 tonnes) and N3 (weighing above 12 tonnes) categories, is proving to be a non-starter for makers of commercial vehicles (CVs) because it hinges on certificates of vehicle scrapping, which barely exist, Business Standard has learnt.

- DEEPAK PATEL

The scheme mandates that a buyer scrap an old vehicle to get a certificate of deposit (CD), which must then be used to claim the incentive on a new electric truck of the same or lower weight. But buyers without an old vehicle—who turn to the government's Digively portal to purchase a CD—are likely to find none.

As of 6 pm Tuesday, Business Standard found just two CDs available in the N2 category and none in N3.

Industry executives and officials confirmed that this acute shortage of N2 and N3 CDs was a persistent issue.

Further, e-trucks priced above ₹1.25 crore are ineligible for incentives. Industry executives say this knocks out several models under development, especially N3 trucks and specialized N2 tippers, which need larger battery packs, which raise the cost of the vehicle.

Along with the CD shortage and pricing cap, the scheme suffers from low incentives, impractical traction, and motor-localisation mandates amid a rare-earth crunch. And there is an approval process with no fixed timelines—even though it ends on March 31, 2026.

Government officials were aware of these concerns. In a May 23 meeting between the Ministry of Heavy Industries (MHI) and industry body Society of Indian Automobile Manufacturers (Siam), all these issues were raised.

The Ministry of Road Transport and Highways, which operates the Digively portal, the MHI, and Siam did not respond to queries sent by Business Standard.

Incentives lower than e-buses

Under the norms set on July 10, demand incentives for e-trucks have been capped at the lower of the two values: ₹5,000 per kWh of battery capacity or 10 per cent of the ex-factory price. This translates into ₹2.7-3.6 lakh for N2 trucks and ₹7.8-9.3 lakh for N3 trucks.