Companies

Ather Energy looks to raise fresh funds, expand to 11 cities

Bengaluru | Updated on October 20, 2020

Tarun Mehta, Co-founder and CEO, Ather Energy   -  Bijoy Ghosh

Eyes a share of the 125-cc-and-above scooter market

Ather Energy, is eyeing a slice of the fast growing 125-cc-and-above scooter market as it looks to raise fresh funds and expand its presence to 11 cities by January, a top executive told BusinessLine.

Backed by founders of Flipkart, Sachin Bansal and Binny Bansal, Hero MotoCorp and Tiger Global, Ather Energy has raised $102.2 million since it was founded in 2013. “We are in the process of raising funds by the end of this year and will announce it as soon as the paperwork is done,” said Tarun Mehta, co-founder and CEO, Ather Energy.

Ather launched India’s first intelligent electric scooter, Ather 450 in 2018, followed by its new flagship offering Ather 450X priced at ₹1,59,000 and Ather 450 Plus (new variant of 450) in January 2020. The company has reduced the ex-showroom price of the 450 Plus model from ₹1,49,000 to ₹1,39,990. It has introduced an ‘Assured Buyback’ programme for the 450X model for ₹85,000 at the end of three years, a first of its kind in the EV category in India.

Deliveries of the 450X and 450 Plus will start in November/December in Ahmedabad, Mumbai, Pune, Hyderabad, NCR and Kolkata followed by Kozihkode, Kochi and Coimbatore. Including Bangalore and Chennai, Ather will be delivering in 11 cities by January. The company has stopped production of the 450 this month, but will continue to support the product.

“At this point in time, for the products that we have in our portfolio, the growing 125 cc scooter market and beyond represents our total addressable market which sells roughly about 1.5 million units annually and is growing at the fastest rate of over 20 per cent YoY. The Ather 450 Plus is similar to a 125 cc scooter and the Ather 450X is more in line with a 150 cc scooter. As we start introducing products at more price points in the coming years, our total addressable market will hopefully expand. We will consider ourselves a pan-India player when we establish a presence in 30-40 cities by December 2021,” said Mehta.

Charging stations

In addition to the existing 40 active, public fast charging stations in Bengaluru and Chennai, Ather will install 135 more stations in the next two months across cities. The company will phase out its manufacturing facility in Whitefield, Bengaluru and move to its new facility in Hosur, Tamil Nadu in two months. “We will start with a capacity of 3,000 units/month and scale it to 8,000 units/month by the first half of next year,” said Mehta.

While Energica Motor Company, REE, FOMO (earlier called 2050 Motors), Ultraviolette Automotive and Ola should count as Ather’s competitors, Mehta said: “some of these have already shut down, some have just demoed a concept and some do not have a consumer product. From a specifications perspective, we have 2 close competitors — Bajaj Chetak and TVS iQube. Both are in limited production runs and are available only in one or two cities like Bengaluru and Pune.”

Post the success of the lease model in Bengaluru and Chennai, Ather Energy will extend the same for the Ather 450X across all cities. The model allows customers to access a fully loaded Ather 450X at a lower price point and a nominal monthly fee. In the current economic context, this might be significant for a segment of customers who are unwilling to opt for a full purchase. To reduce the overall cost of ownership of the Ather 450X, Bengaluru consumers can exchange their old petrol ICE 2-wheeler and others can opt for low interest rate loans from multiple partners that Ather Energy has tie-ups with.

Ather’s revised subscription plans offer four independent packs based on usage, starting at ₹125 a month. These include Ather Connect Lite (for all basic connected features), Ather Connect Pro, Ather Service Lite (periodic maintenance, RSA & labour) and Ather Service Pro (premium service experience). Meanwhile, charging at public charging points, Ather Grid, will be free until March 2021.

Published on October 20, 2020

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