Electric commercial vehicle (eCV) makers were in a quandary as they remained unable to comply with localisation requirements under the PM Electric Drive Revolution in Innovative Vehicle Enhancement (PM eDRIVE) scheme, which are set to come into force from Tuesday, according to industry executives who spoke to Business Standard.
The Society of Indian Automobile Manufacturers (Siam) on July 22 sought a fresh seven-month extension from the Ministry of Heavy Industries (MHI), requesting that the deadline for localising traction motor and motor controller systems for electric buses (e-buses) and electric trucks (e-trucks) be deferred from September 1 to April 1, 2027. The industry body cited continued disruption in the supply of rare earth magnets due to China’s export restrictions.
Government officials on Monday told Business Standard that a decision on the industry’s request is yet to be taken.
Under the PM eDRIVE scheme’s Phased Manufacturing Programme (PMP), manufacturers of e-buses and e-trucks were required to manufacture key components of traction motors in India. The government had originally planned to enforce these norms from September 1, 2025, but deferred the deadline twice following industry representations.
The first extension, announced on September 30, 2025, deferred implementation to March. Subsequently, on March 13, the ministry allowed manufacturers to continue importing traction motors containing rare earth magnets until August 31, effectively pushing compliance with the localisation norms to September 1.
In its July 22 letter to MHI, Siam said China’s export controls on heavy rare earth elements such as dysprosium and terbium, as well as permanent magnets, had “significantly altered global supply chains for permanent magnets”, a critical input for traction motors used in e-buses and e-trucks.
“Although export licences have been granted for certain shipments, procurement remains subject to regulatory approvals, extended lead times, and supply uncertainty,” the industry body had said.
Siam had also said that geopolitical tensions, including instability in West Asia, had worsened supply-chain challenges by increasing transit times, freight costs, and uncertainty over the availability of critical components. “Consequently, original equipment manufacturers continue to face significant challenges in securing a predictable supply of permanent magnets while simultaneously complying with the PMP localisation requirements as originally envisaged,” it had said.
According to Siam, extending the deadline would help prevent production disruptions if supply constraints persist and give manufacturers and component suppliers more time to develop local supply chains and expand manufacturing capacity. The additional time would also allow an orderly transition from imported systems to partially localised and eventually fully localised traction motor and motor controller systems.
The ministry as well as Siam did not respond to Business Standard’s queries on the matter.