Policy · Mobility & Logistics

Ather Energy defers ₹26.25 crore PM E-DRIVE claims due to rare earth magnet shortage

By Startup Enthusiast · 26 September 2025

What they do

Ather Energy is an electric two-wheeler maker based in Bengaluru, India

The company has deferred ₹26.25 crore in PM E-DRIVE subsidies for 52,500 scooters due to a rare earth magnet shortage

Ather is developing a rare earth-free motor and has received type approval from ARAI for this technology

Ather Energy has deferred ₹26.25 crore in PM E-DRIVE subsidies for 52,500 scooters due to a rare earth magnet shortage.
The shortage is caused by China’s export restrictions on heavy rare earth magnets, a key component in EV motors.
Ather Energy had to temporarily adjust traction motor manufacturing, deviating from domestic sourcing rules under the Phased Manufacturing Programme (PMP).
The company is in discussions with the Ministry of Heavy Industries (MHI) to seek a temporary exemption from PMP requirements.
Ather Energy has developed a Heavy Rare Earth Free (HREF) motor, received type approval from the Automotive Research Association of India (ARAI), and started receiving PM E-Drive eligibility certificates for its models.
The company noted an EV subsidy receivable of ₹91 crore in its FY25 annual report, including incentives from the PM E-DRIVE scheme, the Electric Mobility Promotion Scheme (EMPS), and the FAME-II scheme.
Tarun Mehta, cofounder and CEO of Ather Energy, acknowledged that the supply chain would see short-term disruption in Q2 FY26 due to China’s export restrictions on rare earth magnets.

Ather Energy competes with both new-age EV companies such as Ola Electric and legacy two-wheeler makers such as TVS Motor and Bajaj Auto in the electric two-wheeler segment.
In August, the company closed in on Ola Electric, rising to third place in monthly electric scooter sales with a 17.8% market share, according to Vahan data.

Ather Energy is an electric two-wheeler maker based in Bengaluru, India.
The company produces electric scooters and has developed a Heavy Rare Earth Free (HREF) motor to reduce dependency on rare earth magnets.
Ather Energy has received type approval from the Automotive Research Association of India (ARAI) for its HREF motor.
The company has started receiving PM E-Drive eligibility certificates for its HREF motor models.
Ather Energy competes with both new-age EV companies such as Ola Electric and legacy two-wheeler makers such as TVS Motor and Bajaj Auto in the electric two-wheeler segment.
In August, the company closed in on Ola Electric, rising to third place in monthly electric scooter sales with a 17.8% market share, according to Vahan data.

Ather Energy is in discussions with the Ministry of Heavy Industries (MHI) to seek a temporary exemption from PMP requirements.
The company has developed a Heavy Rare Earth Free (HREF) motor and has received type approval from ARAI.
Ather Energy has started receiving PM E-Drive eligibility certificates for HREF motors across multiple models.

Curefoods raises ₹160 crore pre-IPO from Binny Bansal's fund26 September 2025 · Funding · ₹160 crore