EV Prices to Rise: China's Lithium Battery Export Tax Cut Jolts Indian Companies
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News18•20-01-2026, 13:29
EV Prices to Rise: China's Lithium Battery Export Tax Cut Jolts Indian Companies
- •China has reduced the export tax rebate on lithium-ion batteries from 9% to 6%, effective April 1, with plans to eliminate it entirely within a year.
- •This move will increase the cost of batteries, which constitute over one-third of an EV's manufacturing cost, impacting Indian EV prices.
- •Companies like Tata Motors, MG Motor India, Ola Electric, Ather Energy, and TVS Motors, heavily reliant on Chinese battery suppliers (BYD, CATL), will be most affected.
- •The decision comes amidst already rising international lithium prices, creating double pressure on EV companies' margins.
- •The impact is expected within two weeks, with companies attempting to build inventory, but long-term costs will likely be passed on to consumers.
Why It Matters: China's reduced tax rebate on lithium batteries will significantly increase EV costs in India, affecting both manufacturers and consumers.
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