Tata Motors, Mahindra, Suzuki, Hyundai, Hero and TVS are among 20 OEMs shortlisted for the government’s Production Linked Incentive (PLI) scheme. The new PLI scheme for the automotive industry will bring in investments.
The PLI scheme from the Government of India proposes financial incentives of up to 18 per cent as the Ministry of Heavy Industries looks to attract investments and boost the domestic production of advanced automotive technology.
The incentives will be applicable for a period of five years on the sales of products manufactured in India from April 1, 2022. The PLI setup from the Central Government has two schemes – Champion OEM Incentive and Component Champion Incentive. The former scheme applies to battery electric vehicles and hydrogen fuel cell vehicles in all segments. The Component Champion Incentive is linked with the automotive technology components, CKD and semi-knocked down kits and vehicle aggregates across all passenger and commercial sectors.
The 20 OEMs approved were shortlisted from a total of 115 manufacturers who had applied for the Central Government’s PLI scheme when it was notified in September last year. The PLI scheme was approved with a budgetary outlay of Rs 25,938 crore by the Government of India.
The Champion two and three-wheeler OEMs approved under the scheme include Hero, Bajaj, TVS and Piaggio (the maker of Vespa and Aprilia among other brands).
The Champion non two and three-wheeler OEMs approved for the PLI scheme include Ashok Leyland, Eicher, Ford, Hyundai, Kia, Mahindra, PCA Automobiles India, Pinnacle Mobility Solutions, Tata Motors and Suzuki Motor (the Japanese parent company of Maruti Suzuki).
The government has also approved 6 OEMs under the New Non-Automotive Investor banner. These include Ola Electric, Axis Clean Mobility, Booma Innovative Transport Solutions, Elest, Hop Electric Manufacturing, and Powerhaul Vehicle.
Tata Motors has released a statement after the automotive giant was approved for the PLI scheme by the Government of India. The automaker stated, “Tata Motors is delighted with the opportunity provided to participate in the progressive and transformational Auto sector PLI scheme that aims to drive self-sufficiency and world class competitiveness through ‘Aatmanirbhar Bharat’ initiative. We are committed to shape India’s vehicular landscape with smart and sustainable mobility solutions powered by new age technologies to address the evolving needs of both personal and commercial mobility and this opportunity will help us drive this with even greater vigour.”
Thoughts On The PLI Scheme For the Auto Sector
The PLI scheme is the latest move by the Government of India to incentivise the manufacturing of vehicles especially EVs in the country. The new PLI scheme will run alongside the Faster Adaption of Manufacturing of Electric vehicles (FAME) II scheme (Rs 10,000 crores) and the similar incentive set up as part of the Advanced Chemistry Cell (ACC) Battery Storage Programme (Rs 18,100 crore).
With these schemes, the government hopes to turbocharge the automotive sector into becoming a cleaner, electric giant from its current fossil-fueled powered iteration. Hopefully, this new scheme will help spark an electric revolution in a country that is always obsessed with fluctuating fuel prices.
Keyword: Tata, Mahindra, Hyundai & Hero Among 20 OEMs Approved For Govt's PLI Scheme