CCI Rejects Plea Against Abuse Of Dominance By Ola Electric, Ather, Others

CCI Rejects Plea Against Abuse Of Dominance By Ola Electric, Ather, Others

SUMMARY

An anonymous person had filed a plea alleging under-pricing by these two-wheeler companies to avail FAME -II subsidy

The CCI in its order noted that there appears to be “no single player which is able to exert market power in its favour or appears to demonstrate a position of strength to operate independently of market forces.”

Within the EV segment, two-wheelers continue to lead the space. The registrations of two-wheeler EVs in the country grew 34% year-on-year (YoY) to 8.49 Lakh units in 2023

The Competition Commission of India (CCI) has dismissed a plea against electric two-wheeler makers Ola Electric, Hero Motocorp’s Vida, TVS Motors and Ather that alleged they were abusing their dominance in the market.

An anonymous person filed a plea alleging under-pricing by these two-wheeler companies to avail Faster Adoption & Manufacturing of Electric Vehicles -II subsidy. The EV makers had priced their offering under INR 150,000, the maximum pricing allowed to avail of the subsidy, and had charged customers extra for essential components such as chargers and software among others. 

This the complainant said was an alleged abuse of dominant position by the OEMs in contravention of provisions of Section 4 of the Act.

Furthermore, as per the information provided, Ola, TVS Motors, Ather and Vida held market share of 17.57%, 7.51%, 8.32% and 15.75%, respectively, in CY 2022.

Hero Electric and Okinawa held 28.23% and 20.08% market share respectively, followed by Ampere with 10.65% market share, whereas the OPs viz. Ather, Ola and TVS garnered a market share of 8.63%, 6.21% and 4.09%, respectively, in FY2022. 

The commission notes that “none of the market players appear to have a stable market share or position.”

It further finds that with the industry growing at a rapid pace, the competition is set to intensify as more players compete for the market share and ramp up production.

The CCI in its order noted that there appears to be “no single player which is able to exert market power in its favour or appears to demonstrate a position of strength to operate independently of market forces.”

Therefore, it says none of the accused (EV makers) appear to have a dominant position in the relevant market. “Given the facts and circumstances of the present case, the Commission finds that no prima facie case of contravention of the provisions of Section 4 of the Act is made out against any of the OPs in the instant matter. Accordingly, the information is ordered to be closed forthwith in terms of the provisions contained in Section 26(2) of the Act. Consequently, no case for grant for relief(s) as sought under Section 33 of the Act arises and the said request is rejected.”

The ruling comes almost a year after a complainant first approached authorities in February 2023, alleging that the electric two-wheeler makers Ola Electric, Hero Motocorp’s Vida, TVS Motors and Ather were misusing their dominant position in the market.

Consequently, representatives from these companies reportedly met with government officials to respond to the recent whistleblower allegations around the mispricing of vehicles under FAME-II norms in March last year. 

At a time when the entire world is focussed on the usage of green energy in a bid to reduce its carbon footprint, India, too, isn’t far behind. The country is seemingly doing everything in its power to meet its net zero emission goals

The endeavour is visible in the fact that the electric vehicle (EV) adoption in the country has grown about 50% this year. According to Vahan data as of December 29, the registrations of EVs in the country rose to 15.13 Lakh units in 2023 from 10.25 Lakh units in the previous year.

Within the EV segment, two-wheelers continue to lead the space. The registrations of two-wheeler EVs in the country grew 34% year-on-year (YoY) to 8.49 Lakh units in 2023.

This increase happened despite over a dozen companies in the category getting involved in FAME-II controversies and the government slapping crores of fines on original equipment manufacturers (OEMs). As such, the increase in sales could have been even higher if the FAME-II fiasco had not taken place.

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CCI Rejects Plea Against Abuse Of Dominance By Ola Electric, Ather, Others-Inc42 Media
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