Ather CEO Slams EV Scheme Favoring Legacy Giants

Ather Energy CEO Tarun Mehta has criticized the government's production-linked incentive (PLI) scheme for automobiles, stating its current structure disadvantages electric-first companies. Mehta argues the framework prioritizes legacy scale over EV-specific capabilities, potentially hindering India's electric mobility ambitions. He noted that startups, which have been crucial in developing India's EV ecosystem, are excluded by high revenue and fixed asset thresholds.

The scheme's eligibility criteria require OEMs to report at least ₹10,000 crore in global automotive manufacturing revenue and hold fixed assets worth ₹3,000 crore. This effectively excludes most electric-first manufacturers that began at a smaller scale. Mehta stated this policy creates a 13-16% cost disadvantage for emerging EV manufacturers, who are heavily investing in capability building and innovation.

A report by C-Dep echoed these concerns, suggesting the policy signals a preference for scale over innovation. The automobile and auto components PLI scheme aims to boost domestic manufacturing of advanced automotive technologies, including electric and hydrogen vehicles. Investments under the scheme have exceeded ₹35,000 crore, leading to significant EV production and job creation, with beneficiaries including major manufacturers like Tata Motors and Ola Electric.

Mehta advocates for a "calibration of PLI, not overhaul," suggesting more flexible eligibility criteria aligned with localization and R&D intensity. A parliamentary panel has also raised concerns, recommending "calibrated flexibility or differentiated eligibility criteria" for startups. The panel observed that sales performance, job creation, and incentive disbursements remain below targets.