The Hindu Business Line : Hero Electric plans to cut prices

Ahmedabad, May 2 With the State Governments beginning to encourage the eco-friendly and economic electric vehicle segment with subsidies, Hero Electric, makers of electric scooters, is planning to reduce prices of its products.

The Delhi Government recently announced a subsidy of about 30 per cent on electric vehicles (EVs). Hero Electric will pass on these incentives to the consumers, thereby making the EVs a cost-effective option, Mr Naveen Munjal, Managing Director, told Business Line.

Production capacity

The company is, however, yet to work out the extent to which it could reduce prices and pass on the maximum benefit to the consumer. Describing as “guesstimate” the AC Neilson’s 2006 survey predicting the category potential of EVs to 4.90-lakh units in 2008-09 in the country, Mr Munjal said the market in this segment is yet to pick up.

However, the company would review the demand and Hero Electric would consider increasing its production capacity further after about a year. At present, Hero Electric is not considering to enter the electric-run three or four-wheeler segment.

Hero Electric, a 100 per cent subsidiary of the $4-billion Hero Group, also plans to invest Rs 80 crore for expansion and research and development at its Ludhiana-based plant and launch a range of high-speed two-wheeler electric vehicles in July this year.

The company, which has doubled its production capacity to more than1.25-lakh units a year, is targeting sales of 70,000 units this year.

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