E-bus tender bids to get aggressive

Electric bus makers who were reluctant to participate in tenders floated by the Centre will now aggressively bid for them, with the government addressing concerns regarding the lack of a payment security mechanism.

The Rs 57,600-crore PM eBus Sewa scheme announced in August aims to bolster e- bus adoption by introducing 10,000 e-buses through the public private partnership route in 169 cities.

Speaking to FE, Mahesh Babu, CEO, Switch Mobility, said, “The government took our feedback before forming the payment security mechanism in which the government will assure us a certain portion of the amount in the escrow which we can take monthly or on a 15-day basis.”

“We are now working with the central and state governments to refine the policy to make sure it’s a win-win for all,” Babu added.

As per the model, the e- buses are to be run for a period of 12 years by service companies which are owned by the bus manufacturers themselves. The payments to these bus operating companies would be made by state transport undertakings (STUs). But since the financial health of these STUs are uncertain, the interest of bus makers in tenders waned.

Girish Wagh, executive director, Tata Motors, said, “There is a limit to which we can take load on our balance sheet and therefore there is a need for a payment security mechanism. Though we stayed away from past tenders, the government is now very clear that they will come up with tenders only when the payment security mechanism is in place. Once that is done, we will be back in the game.”

After a resounding success of the first e-bus tender where bus makers aggressively participated, the third and latest tender of 4,675 buses, which was floated a few months, saw the participation of just one company. The government was forced to scrap the tender.