More than 100 companies file applications under PLI scheme for auto sector

A total of 115 companies have filed their application under the Production-Linked Incentive Scheme for the automobile and auto sector in India.

Of the applicants, 13 are original equipment manufacturers (with the exception of 2W and 3W), 7 are 2W & 3W OEMs, 83 are component companies, 9 are new non-automotive (OEM) investor companies and 3 are new non-automotive (component) investor companies.

The scheme has two components namely Champion OEM Incentive Scheme and Component Champion Incentive Scheme. The Champion OEM Incentive scheme is a ‘sales value linked’ scheme, applicable on Battery Electric Vehicles and Hydrogen Fuel Cell Vehicles of all segments. The Component Champion Incentive scheme is a ‘sales value linked’ scheme, applicable on Advanced Automotive Technology components of vehicles, Completely Knocked Down (CKD)/ Semi Knocked Down (SKD) kits, Vehicle aggregates of 2-Wheelers, 3-Wheelers, passenger vehicles, commercial vehicles and tractors, etc.

Incentives are applicable under the scheme for determined sales of advanced automotive technology products manufactured in India from April 2022 onwards for a period of five consecutive years. The scheme for the sector was approved with a budgetary outlay of Rs 25,938 crore, aiming at strengthening the domestic manufacturing of these products.

The scheme’s primary objectives include overcoming cost disabilities, creating economies of scale and building a robust supply chain. It will also generate employment. This scheme will facilitate the automobile industry to move up the value chain into higher value-added products.

The Ministry of Heavy Industries (MHI) said in a statement, “The Production Linked Incentive (PLI) Scheme for Automobile and Auto components proposes financial incentives to boost domestic manufacturing of Advanced Automotive Technology products and attract investments in the automotive manufacturing value chain. Its prime objectives include overcoming cost disabilities, creating economies of scale and building a robust supply chain in areas of Advanced Automotive Technology products.”