WATT weekly

2020-02-10

India’s BEV Bus Sector: China’s BYD, Beiqi Foton Are Second Only to Local Players

In India, public buses have begun to be replaced by electric models, a trend which is supported by the government. Government of India is assisting in purchasing about 7,000 BEV buses for public transportation in the second phase of FAME India, a plan to accelerate the spread of electric vehicles and promote their production, for the three years from April 2019 to March 2022. The allocation of subsidies for about 5,600 vehicles was decided in August 2019. Competition for orders has begun, with two major Chinese bus companies, BYD and Beiqi Foton, joining major local bus manufacturers such as Tata Motors and Ashok Leyland. The projection is that public buses will be significantly replaced with BEV models in the next few years.

In the first phase of FAME India, only 425 BEV buses were eligible for subsidies during the four-year period from April 2015 to March 2019. In the second phase, 7,090 units are planned to be subsidized in three years. In line with this plan, the Indian government has allocated a budget of 35.45 billion Indian rupees, equivalent to approximately 35% of the total budget of 100 billion Indian rupees of the second phase of FAME India, to subsidies for purchasing BEV buses. By narrowing down subsidies only to public buses with fixed service routes, India aims to minimize the problems surrounding cruising distance and charging infrastructure in an effort to promote smooth transition to BEV buses.

In August 2019, 5,595 units, or 70% of the 7,090 BEV buses to be subsidized, were allocated to public transport companies in a total of 64 cities in 22 states and federal territories. Of these, 5,095 units will be used for urban transport, 400 units for intercity transport and 100 units for last-mile transport by the Delhi Metro Railroad Corporation (DMRC). The largest number of BEV buses will be subsidized in Maharashtra state.

Heading toward the electrification of public buses, Tata Motors, Ashok Leyland, VECV (Eicher Motors), BYD, Beiqi Foton and others began to compete for orders in the BEV bus market.

Tata Motors has received about 60% of the orders for subsidized BEV buses in the first phase of FAME India, and the company also keen to win orders in several states in the second phase. In December 2019, the company announced that it has won orders for more than 2,300 BEV buses from seven transportation companies in five states in India.

In January 2020, Ashok Leyland announced a partnership with ABB Power Products and Systems India, an affiliate of Swiss engineering giant ABB, to enhance its BEV bus product capabilities. In the future, the company plans to jointly develop an BEV bus equipped with ABB's rapid charging system.

BYD has partnered with local Olectra Greentech to produce and sell BEV buses under the Olectra BYD brand name. The company is considered second only to Tata Motors in BEV bus deliveries in India. Olectra BYD BEV buses are operated in several states.

Beiqi Foton manufactures and sells buses including EVs under the Foton PMI brand name in India by licensing a local bus assembly manufacturer PMI Electro Mobility Solutions (PEMS). To strengthen its production system, the company announced in December 2019 that it will establish a new joint venture company with PEMS to manufacture BEV buses with an annual production capacity of 6,000 units in Pune, Maharashtra state.

India: Measures to Promote BEV Bus Penetration in the Second Phase of FAME India

Outline of Measures to Promote Market Expansion (Mar. 2019)

・In March 2019, India’s Ministry of Heavy Industries and Public Enterprises announced the second phase of FAME India scheme which is intended to production and market penetration of electric vehicles. The application of the program started in April 2019. – FAME India is a scheme that stipulates subsidies for purchasing various electric vehicles and government support for the development of charging infrastructure. The first phase was implemented between April 2015 and March 2019. – The second phase is implemented between April 2019 and March 2022. [Overview of the BEV Bus Purchase Subsidy System] ・Budget for purchase subsidy payment: 35.45 billion Indian rupees. – The total budget of the second phase of FAME India is 100 billion Indian rupees, of which 35% of the total will be allocated to subsidies for BEV bus purchases. ・Purchasing subsidy per BEV bus: 20,000 Indian rupees per 1 kWh of battery capacity. – As an example, in the case of a BEV bus with a battery capacity of 250 kWh, the purchase subsidy per vehicle is 20,000 Indian rupees x 250, which is 5 million Indian rupees. – However, the upper limit is 40% of the vehicle price. ・Number of vehicles for which purchase subsidies allocated: 7,090 units. ・Conditions for eligibility: ◇The vehicle must be operated for public transportation (Private company commuter buses, school buses for school use, airport shuttle buses, etc. are excluded.), ◇Vehicles priced (based on factory shipment value) 20 million Indian rupees or less, ◇Being a domestically produced car, domestically produced designated parts such as batteries according to a prescribed schedule, etc.

Announcement of technical requirements (June 2019)

・In June 2019, India’s Ministry of Heavy Industries and Public Enterprises announced the technical requirements for BEV buses to qualify for the second phase of FAME India’s subsidies. – Specified by Public Notice S.O. 2068 (E) dated June 21, 2019. – The requirements for four wheelers (M1, N1) excluding motorcycles, tricycles and buses were announced in March 2019, but the technical requirements for BEV buses were first introduced by this new announcement. – For BEV buses, the technical requirements were set for buses with a total length of 9 m or less, and for buses with a length of 9 m or more but 12 m or less. See the table below for details.

Unit quota by state (August 2019)

・In August 2019, India’s Ministry of Heavy Industries and Public Enterprises announced its decision to allocate purchase subsidies for 5,595 BEV buses under the second phase of FAME India program. – With this announcement, the purchase subsidies of about 80% of the 7,090 units of BEV buses were determined. ・BEV buses were distributed to 64 cities in 22 states and federal territories. – Prior to the decision on the number of vehicles to be allocated, a total of 86 applications (14,988 units) were submitted from 26 states and federal territories. ・Out of the 5,595 BEV buses, 5,095 units are intended to be used to urban transportation, 100 units for interurban transportation and 400 units for last-mile transportation by the Delhi Metro Rail Corporation. ・The subsidized 5,595 BEV buses are assumed to have a total mileage of 4 billion km during the period indicated in the introduction plan. This is expected to reduce fuel consumption by 1.2 billion liters and CO2 emissions by 2.6 million tons.

Recent Business Trends of Major BEV Bus Manufacturers in India (BEV Bus-related Only)

Tata Motors

[BEV bus orders / delivery record] ・Under the first phase of FAME India (April 2015 – March 2019), Tata Motors received orders for 255 BEV buses. – Out of the 425 BEV buses subsidized during the first phase of FAME India, BEV buses supplied by Tata Motors accounted for 60% of the total, securing the largest number of orders. – Major clients were transportation companies from the following administrative units: West Bengal (WBTC), Lucknow (LCTSL), Indore (AICTSL), Assam (ASTC), Jammu & Kashmir (JKSRTC) and Jaipur (JCTSL). ・From February to July 2019, the company delivered some of the BEV buses ordered in the first phase of FAME India. – In February 2019, the delivery of 40 BEV buses to Lucknow began. – In February 2019, the delivery of 80 BEV buses to West Bengal began. – In July 2019, the delivery of 40 BEV buses to Jammu & Kashmir began. ・In October 2019, the company won an order for 300 BEV buses from Ahmedabad Janmarg Ltd. (AJL) which operates a bus rapid transit system (BRTS) in Ahmedabad, Gujarat state. – The delivery model is the Urban 9/9 Electric AC Bus. It is scheduled to run on the Ahmedabad BRTS corridor. – Tata Motors will also supply the necessary infrastructure such as quick charging stations needed to introduce BEV bus operations. ・In December 2019, the company announced that it has received orders for more than 2,300 BEV buses from seven transportation companies in five states in India. Orders came from the following states: Rajasthan (RSRTC), Karnataka (KSRTC, BMTC, NWKRTC), Uttar Pradesh (UPSRTC), Tamil Nadu (IRT) and Andhra Pradesh (APSRTC).

Mahindra

[Planning to introduce BEV buses] ・Mahindra is expected to start introducing BEV buses after 2020. – Mahindra unveiled the eCosmo EV bus at India’s Auto Expo 2018 in February 2018. At the same time, three types of buses were scheduled to be launched, the T32 (7.9m long, 32 seats, GVW 9t), T36 (8.8m long, 36 seats, GVW 9.7) and T40 (9.6m long, 40 seats, GVW 10.2t). The cruising range is expected to be 160km or 230km. The drive motor was jointly developed with Canada’s TM4.

Ashok Leyland

[Technology alliance] ・In January 2020, the company partnered with ABB Power Products and Systems India (ABBSIL, ABB Power Grid’s Indian business unit), an affiliate of Swiss engineering giant ABB, to develop electric buses. – Under the agreement, the two companies will launch a pilot project for BEV bus development, utilizing ABB’s fast charging technology TOSA. The BEV bus to be jointly developed is said to be equipped with TOSA, which will enable quick charging (600 kW) for 15 seconds at a designated bus stop and charging for a few minutes at the last bus stop to provide the necessary power for operation. – ABB will also supply Ashok Leyland with Supervisory Control and Data Acquisition (SCADA), a monitoring system for BEV buses and charging systems.

Eicher Motors(VECV)

[Business overview] ・Eicher Motors produces BEV buses at the VE Commercial Vehicles plant, a joint venture with Volvo. In the development of BEV buses, the company has partnered with local engineering giant KPIT. [BEV bus orders / delivery record] ・In May 2018, the company received an order for three BEV buses for public transportation from New Town, a satellite town of Kolkata in West Bengal state. – The delivery model is the Skyline Pro-E. It was introduced as a fixed-route bus operated by West Bengal Housing and Infrastructure Development Corporation (WB HIDCO). ・In June 2019, the company won an order for 40 BEV buses from Brihanmumbai Electricity Supply and Transport (BEST), a public transport company in Mumbai, Maharashtra state. – Apparently, delivery started in the latter half of 2019. ・The company plans to supply 400 BEV buses in the fiscal year ending March 2020 (as of June 2019).

BYD / Olectra Greentech

[Business overview] ・BYD has partnered with local Olectra Greentech in India to produce and sell BEV buses under the Olectra BYD brand name. – Olectra Greentech is an insulator manufacturer founded in 1992. It was formerly known as Goldstone Infratech. The company started a partnership with BYD in 2017 and began importing and selling buses in September 2017. Local production started in June 2018. – Olectra Greentech’s headquarters and BEV bus plant are located in Hyderabad, Telangana state. The assembly of the bus chassis and batteries is handled by BYD. [BEV bus orders / delivery record] ・As of 2018, three cities, Bangalore in Karnataka state, Hyderabad in Telangana state and Mumbai in Maharashtra state, have ordered a total of 290 BEV buses. – One hundred fifty units were delivered to Bangalore, 100 units to Hyderabad and 40 to Mumbai. ・As of 2019, in addition to the three cities mentioned above, the company has delivered to Delhi, Rajkot in Gujarat state, and Kochi in Kerara state. ・In June 2018, five BEV buses were delivered to Nepal. ・The company plans to supply 500 BEV buses in the fiscal year ending March 2020 (as of June 2019). [Planning to build a second BEV bus plant] ・A second BEV bus plant may be built in India by around 2021 (according to various local reports as of June 2019). – Details have not been announced yet, but the new plant is expected to be located in northern India. Initially, Karnataka state was proposed as a candidate site, but it is said that the plan was changed due to difficulties in negotiations with the state government.

Beiqi Foton / PMI Coaches

[Business overview] ・Beiqi Foton manufactures and sells buses (including BEV buses) in India under the Foton PMI brand name. PMI Electro Mobility Solutions (PEMS), a bus assembly manufacturer under the umbrella of PMI Coaches, carries out assembly. – PEMS is a consolidated subsidiary of PMI Coaches and was established in 2017. The PEMS’ production base is located in Daruhera, Haryana state. Its annual production capacity is 4,500 units. The plant can also produce BEV buses. [BEV bus orders / delivery record] ・By 2019, Beiqi Foton has delivered 50 BEV buses to Himachal state. ・In November 2019, the company announced that it has received an order for BEV buses from local low-cost airline SpiceJet (number of units is unknown). – The BEV buses will be operated at the Indira Gandhi International Airport in New Delhi. ・In 2020, the company plans to start production and delivery of 700 BEV buses to fulfill an order from Uttar Pradesh state. [Joint venture establishment] ・In December 2019, China’s Beiqi Foton and PEMS announced that they would establish a joint venture production company for BEV buses in India. – Given the tight capacity of the existing plant of PEMS, the two partners decided to build a new BEV bus joint venture production company. – The tentative name of the new company is Foton PMI Electric Bus India. – Registered capital is planned to be set at 500 million Indian rupees (about 50 million Chinese yuan). – The joint venture is 30% owned by Beiqi Foton and 70% by PEMS. Beiqi Foton will invest through Foton Motors Manufacturing India, its wholly owned Indian subsidiary. – The Board of Directors will have two members from Beiqi Foton and three from PEMS. – The new company will have its headquarters and production site in Pune, Maharashtra state. Construction of the plant is scheduled to begin by March 2020. – Investment for the next two to three years is planned to reach 5 billion Indian rupees. – The new plant’s annual production capacity for BEV buses is expected to be 6,000 units. (Takashi HORII)