Haryana-based bus manufacturer, Foton PMI, on Friday (November 8), announced that it plans to invest INR 500 Cr in a joint venture with a Chinese automaker Beiqi Foton Motor Co. to manufacture electric buses in India.
As per a PTI report, the JV named Foton PMI is expected to utilise the funds to set up its new electric bus manufacturing facility in Pune, in the next two to three years.
Foton Motor is a Chinese automobile manufacturing company that designs and manufactures trucks, buses, sports utility vehicles and agricultural machinery among others.
In a statement, Anurag Agarwal, vice chairman and executive director of Foton PMI, said that the new plant will have the capacity to manufacture around 500 electric buses per month and the construction will start from March 2020 onwards.
Zhang Xiyong, the chairman of Foton Motor, is optimistic about the decision and said that the company will plan to use India as a manufacturing hub for electric commercial vehicles and export it to other markets including South East Asia, Middle East and Africa.
Moreover, the company also mentioned about its collaboration with Indian airline carrier, SpiceJet, where it will help in its logistics and operations at Indira Gandhi International Airport in Delhi. The company recently has given five electric buses for SpiceJet’s internal operations, Agarwal added.
Foton PMI Capitalises On Govt Subsidies
Currently having a manufacturing plant at Daruhera in Haryana, PMI Electro Mobility Solutions (PEMSPL) in collaboration with Foton Motor, has supplied 50 electric buses to Himachal State Road Transport Corporation. The company has already received orders of 700 electric buses from Uttar Pradesh, which will be supplied by next year. Since 2017, Foton Motor, has invested INR 350 Cr on PEMSPL.
In April 2019, the Indian government began implementing phase 2 of Faster Adoption and Manufacturing of Electric Vehicles (FAME II). Under this policy, the government proposed to invest INR 10,000 Cr over the next three years to support 10 Lakh two-wheelers, 5 Lakh three-wheelers, 55K four-wheelers, 7K buses that operate on lithium-ion batteries.
Also, in June 2019, the government was looking at deploying 5,000 electric buses, under the Fame II scheme, where the Department of Heavy Industries issued an expression of interest (EOI) calling for proposals from state transport departments.
According to the EOI, the selected cities will be offered a subsidy of 40% on cost, or up to INR 55 Lakh per standard bus of 10-12 metres. Precisely, for mid-bus of 8-10 metres, the subsidy will be up to INR 45 Lakh, while for a mini electric bus, it is INR 35 Lakh.
Earlier last week, the German Chancellor, Angela Merkel announced that her government will spend $1.12 Bn on India’s green mobility projects, and the fund will be used to support various environment-friendly projects, building charging infrastructure and introduction of electric buses to replace the existing diesel vehicles for public transportation in India.