Ather Energy says impacted by rare earth magnet issue, to forego incentives worth ₹26 crore

Electric two-wheeler maker Ather Energy has informed the exchanges that it has been impacted by supply disruptions following China’s export ban on certain categories of heavy rare earth magnets.The company said it remains committed to complying with all PM E-DRIVE and Phased Manufacturing Program (PMP) guidelines.

However, due to circumstances beyond its control, Ather, through its motor suppliers, was forced to make temporary adjustments in the manufacturing process of traction motors, specifically relating to the domestic fitment of magnets.

Ather said that while this is a temporary measure, it could affect its ability to submit demand incentive claims for up to 52,500 vehicles manufactured and/or to be manufactured under the PM E-DRIVE scheme.The company has initiated discussions with the Ministry of Heavy Industries, seeking a temporary exemption from the PMP requirement on domestic magnet fitment.

Pending a clear decision from the ministry, Ather has deferred submission of demand incentive claims amounting to ₹26.25 crore for these vehicles.

“We have successfully developed a Heavy Rare Earth Free (HREF) motor and have received type approval (CMVR Certificate) from ARAI. We have also started receiving PM E-DRIVE eligibility certificates for HREF motors across different models,” it said in the filing.

Shares of Ather Energy ended Thursday’s session 4.44% lower at ₹556. Despite the decline, the stock has gained 30% over the past month.