Your E-Bus Will Be Fixed. Eventually. Probably.

On a December morning in South Bangalore, an e-bus stalled. When the driver tried to restart it, it just refused to. You can imagine how things went down. It was a weekday morning and so the uncooperative bus left tech workers and others all scrambling to find autos or bikes to get to work on. Inside the Bangalore metropolitan transport corporation, a woman named Jayap picked up the driver's frantic call. This is a third such call this month. She opened up a dashboard, logged in the incident and pinged a diagnostic team to confirm what the fault was. Now if you've ever wondered what happens when a public e-bus breaks down, this is the first step in the process. Then, it turns out at least three agencies get notified. But somehow, not one of them is quite sure how they should go about fixing it. Jayap has been with the BMTC for four years. Three handles all these calls and error reports. She told my colleague, the can report on run-my, that the older electric buses especially don't fail in predictable ways. Sometimes, they run for too long between charge times. Sometimes the heat overwhelms the mechanisms. Sometimes it's the cold. No matter the reason, each breakdown eats into the run time. In the four years since 2022, BMTC has run over 1500 e-buses and logged nearly 14,000 breakdowns. But here's a catch. Despite all the hands-on-work somebody like Jayad does, BMTC has little control over permanent fixes. They are not the ones leasing these buses, so they can't even raise maintenance tickets directly with the companies that do lease them. Because India's major cities like Mumbai, Bangalore, Pune and Delhi, central agencies like CESL, which is the convergence energy services limited and NVVN, which is the NPPC Vidyothviyapar Nigam limited, procure the fleets. Stay transport units or STUs, which are pretty cash-strap by the way, just operate these buses. They only pay these aggregators for every kilometre that's run and not really for ensuring reliability. So basically, the system just logs the breakdowns, calculates fines and then just moves on. In the end, the contracts between companies just limit the penalties. These companies might have to pay a fine but they won't lose much, even when buses stay broken. Which means that the STUs lose roots and revenue, the original equipment manufacturers or OEMs absorb the penalties and public trust in electric buses erode. And all of this is happening just as India is about to deploy nearly 14,000 more e-buses and under the same model. Welcome to Daybreak, a business podcast from the Ken. I'm your host, Rachel Varghese and every day of the week, my co-host, Nikita Sharma and I will bring you one new story that is worth understanding and worth your time. Under India's electric bus program, cities don't buy e-buses directly. Procurement runs through central agencies under schemes like FAME, which is the faster adoption and manufacturing of electric vehicle scheme or the Prime Minister's e-bus save-up. These agencies aggregate demand float tenders and sign long-term contracts with manufacturers and operators. Their goal is scale and cost control. It also shifts authority away from cities. Agencies like CESL and NVVN sign contracts with manufacturers and hold warranties. Payments also flow through them. Meanwhile, state transport units operate the buses and pay a per kilometer fee to the original equipment manufacturers or OEMs. A former NVVN official told RUNMAI that this structure was no accident. He went on to say that because the electric bus push came from the centre and so did the subsidy when it came to control that also stayed central. That's not how the states usually buy buses. Now this model does work when buses run as expected. But when they don't, the authority fragments. What states can do is log faults and track downtime. What they cannot do is escalate failures directly to manufacturers or demand design fixes. Those decisions sit higher up in the chain. A few months ago, BMTC issued hefty penalties after repeated traffic violations from staff, safety lapses and maintenance failures. Fines cross 25 crore rupees over 2 years for 4 firms running e-buses. That's Tata Motors, Electra Green Deck, Switch Mobility and JBM Auto. In Pune, this problem has turned into a balance sheet shock. The transport authority there is planning to replace batteries on 6 year old buses. That's going to cost them 20 lakh rupees per bus. That is nearly a quarter of the original price. Now you might be thinking, if there are fines, there must be accountability. Unfortunately, that is in the case. Turns out, the financial burden rarely falls in full on the OEMs themselves. State units track downtime and flag violations, but the actual fines are processed by the contract owner. Which in this case are the central agencies. That ends up happening is less punishment and more an exercise in reconciliation. Numbers get logged, penalties are calculated and eventually amounts are adjusted against future payments often weeks later. A senior BMTC official told Runway that the 25 crore figure wasn't them imposing a direct fine. They had essentially issued a recommendation under the service clause. More importantly, these deductions are capped by design. See, under the contract's use for electric buses, penalties only apply after fleet availability falls below 85 to 90 percent, with maximum daily and monthly caps. Once those caps are reached, deductions stop even if the buses are staying idle. Effectively speaking, a bus that breaks down briefly and one that stalls for a whole day can face the same penalty. The result is that a bus can sit idle for days and still earn most of its monthly payment. For cities, that creates a familiar problem. Down time hurts them immediately. Passengers wait longer or switch to other models. And as a BMTC official said, even when deductions happen, it doesn't really make up for lost truth or lost revenue. India's first big bash of electric buses hit the road between 2019 and 2021. Those fleets are now 4 to 5 years old. That's exactly the time when batteries start to lose capacity, thermal margins shrink and early design compromises start to show up. Most of BMTC's 1500 electric buses came between 2020 and 2022. These first generation vehicles were built when speed mattered more than testing. Many run older battery packs with air cooling. Delhi is a little ahead of the curve. It runs 3400 electric buses, which is the country's largest fleet. Though even here, a sizable chunk came from that 2020 to 2022 batch. So by 2023, the transport corporation was flagging poor readiness, warning that buses were struggling in Delhi summers. An engineer from Electra Green Tech, which supplies a large share of Pune's e-buses, said that early failures were often tied to battery behavior and not mechanical faults. Delhi explained that when buses started throwing voltage imbalances or sudden cutoffs, they could adjust cooling and current limits. But if the issue is inside the battery management system, they'd have to wait for BYD, which is a Chinese electric vehicle maker to push an update. The thing is, the limits of those early designs became clearer only in the heat. Even though the older packs were air cooled, they couldn't withstand Indian summers. Indian's temperatures climbed, bolted with sag and protective cutoffs would kick in. Pune fined BYD 25 crore rupees last September exactly because of this. In hindsight, none of this is that surprising. Part of the problem was how batteries were being sourced. In the early phases, cells came from different suppliers at different times. On paper, they were all the same, LFP or lithium ion phosphate. But in practice, they behaved differently, especially once deployed at scale. Also, manufacturers often don't control the battery management systems. Those belong to suppliers like BYD as intellectual property. So when something goes wrong, fixes require coordination across multiple parties. So what really caught cities off guard was a timing. Failures started to surface just as fleets crossed 4 to 5 years, when degradation becomes harder to manage. Even though warranties covered this period, many problems did not qualify for full battery replacement. Meanwhile, buses that looked fine at delivery now run 12 to 14 hours daily through congestion, heat and frequent fast charging, which is a very different life from what they were tested for. The reliability problems aren't exactly accidental. They are tied to how India scared electric buses under FAME 2. Launched in 2019, the scheme pushed rapid adoption through subsidies. Of the roughly 11,500 crore rupees allocated, electric buses received the largest per-unit subsidies. As of March 2025, over 6,800 e-buses were sanctioned with more than 5,100 delivered. A senior executive at Tata AutoComp told RUNMI that the timelines were aggressive. There was enormous pressure to ramp up before subsidies windows were closed, and when speed becomes a priority, of course, validation takes a hit. The policy also skewed what counted as success. Currently, under the gross cost contract model, payments were linked to kilometers at a run, not the reliability of the buses. Also, the fleets were being scaled faster than the feedback loops that were required to refine them. The same senior executive at Tata AutoComp told us that in the early patches, some manufacturers were clearly rushing. In the rush, checks were being bypassed to deliver volumes, and of course, everyone was racing to meet subsidy timelines. Now, there are some signs that the system is learning. Buses delivered after 2022 look quite different. They move to liquid-cooled battery packs and tighter tuning for Indian conditions. BYD has opened limited diagnostic access, and Electra has begun thermal testing in local conditions. But, the procurement architecture still hasn't changed. Agencies like CESL and NVBN still sit between manufacturers and cities. Buses are still bought in bulk, and state units still operate fleets that they don't lease. Newer schemes acknowledge that electric buses need better financial cushioning, but they don't fundamentally alter who controls fixes when something breaks. Take that December morning from the beginning of the episode. The eBus had stalled because the battery management system glitched and shut the bus down. Jaya locked the complaint on the dashboard BMTC shares with NVBN. She told us that BMTC would probably take it out of the manufacturer's monthly fees. The bus was removed from the road, and one more vehicle was taken off of an already stretched schedule. Commuters would now either have to crowd onto the next bus, or book an Uber. Jaya closed the ticket and moved to the next call, because there would definitely be another one before her shift ended. Daybreak is produced from the newsroom of the Ken India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription offers daily long-form feature stories, newsletters and a whole bunch of premium podcasts. To subscribe, head to the Ken.com and click on the red subscribe button on the top of the Ken website. Today's episode was hosted and produced by my colleague Rachel Wurgies and edited by Rajiv CN.