Hero Cycles’ CEO warns of billions in lost eBike exports to EU

The head of Hero Cycles has warned that India stands to lose as much as 10,000 (€1,156 Billion) crore in eBike exports to the EU over the next five years if the Indian Government does not adapt its FAME-II and production-linked incentive (PLI) schemes to build in pedal assist cycles.

Speaking to local press, Hero Cycles’ MD Pankaj M Munjal said that the exclusion of eBikes from the Government’s major international trade initiatives would stunt the opportunity to compete on exports to Europe.

The FAME-II initiative relates to a “National Mission on Electric Mobility”, but the focal point thus far falls on larger electric vehicles and their production.

Alongside this, Munjal decried India missing out on the Generalised Scheme of Preferences lowest tariffs, stating that the current 14% duties on shipments to the EU should come down to 0% with respect to India aligning with lesser developed countries who benefit from zero tariff regulations.

“We are losing out on the policy side that would have helped the industry to take advantage of the shrinking share of China and far-East as the suppliers of e-bikes to the EU,” Munjal told press, referencing a cataclysmic collapse in China’ e-Bike exports to the EU in the face of anti-dumping measures.

Alongside this, many firms are instead opting to reshore production lines closer to home, often in the EU. Eurostat data has a breakdown of which territories have gained in recent years as a result.

“We are afraid the specific exclusion has a masse migrated the manufacturing value of around Rs 1,000 crore going up to Rs 3,000 crore in FY24 to the re-shored capability of the European Union (EU),” Munjal said, adding “In the next five years, India would lose a visible pipeline of Rs 10,000 crore worth of eBike exports if the re-shored capability of the EU manages to secure the migrating business out of China instead of India.”

Munjal expressed that representation has been made to the ministries in charge of the policy, with questions asked as to why even electric scooters benefit but eBikes do not.
Hero Cycles is, by volume, now likely to be the worlds largest manufacturer of cycles and will be catching up on value having begun to expand heavily into the electric bike space within the past five years. The business has invested heavily around the globe, allocating 300 Crore specifically to electric bicycle manufacture in India.

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