Opinion

The charge of the EV brigade

Paran Balakrishnan | Updated on June 25, 2019 Published on June 25, 2019

Electric two- and three-wheelers are hitting the road at a fast pace, but the transition is bound to be disruptive

For Goldie Shrivastava, it’s all about taking the last mile to profitability. His company SmartE has 1,000 electric three-wheelers parked by a handful of Delhi Metro stations ready to ferry passengers to nearby destinations. Now, SmartE is preparing to buy several thousand more E-three-wheelers to serve more stations along the ever-expanding metro. Says Shrivastava: “Electric vehicles cost about 40 paise per kilometre. For a petrol vehicle, that would be almost 10-times more.”

The government has triggered a furious battle with the country’s top two-wheeler makers by announcing at a NITI Aayog meeting it wants to halt production of internal combustion three-wheelers by 2023 and two-wheelers with 150cc engines and below by 2025. The government wants to bring in EVs swiftly to tackle pollution, but manufacturers like Bajaj, TVS and Hero MotoCorp insist such a short-notice switch is impossible and it would destroy an industry that’s a key global exporter. They point out forcefully it was the Chinese move to e-mobility that left international markets wide open for Indian manufacturers. Almost 85 per cent of the scooter industry would be affected by such a changeover.

In reality, EV two-wheelers are already hitting the roads in small numbers but getting ready for a 2023 takeover will require massive spending. Sales of EV three- and two-wheelers are doubling, even tripling, but from a tiny base. So they aren’t about to rudely push older-tech IC vehicles off roads in the near future but the moment of reckoning is coming.

The industry is about to be hit two ways, says auto analyst Deepesh Rathore. “The two-wheeler industry’s heading for a major disruption. At one level there’s renting. The second mega-trend is electric.” Also, Rathore adds crucially: “The market’s moving from five-to-six brands to 15-to-20 brands.”

Take a look at Ather Energy, one of the most high-profile EV two-wheeler companies now selling 50 vehicles daily and up to 70 on weekends from its Bengaluru outlets. The company is about to set off down the road to Chennai where it expects similar sales, and it’s also looking at building a second plant with a one-million-vehicle annual capacity.

Ather’s going about its expansion methodically and has already installed 50 charging stations in Bengaluru at four-kilometre intervals. It’s also got two “experience” centres where customers can take bikes for an “experiential” spin. Expansion to 30 Indian cities is set for around 2023.

Okinawa Scooters is much further down the road in numbers. The company, founded by industry veteran Jeetender Sharma, sold 45,000 two-wheelers last year and aims to double that to a lakh this year. It can double capacity at its present unit and is about to open a second plant able to handle one-million e-scooters annually.

The company is earmarking ₹200 crore for its expansions and has just launched a roadside assistance scheme. On the cards also is an Okinawa motorcycle, due for launch around Diwali, capable of 100 kmph with a 150 km-range. Okinawa is looking at fast-paced expansion and aims to hire 450 dealers by the year-end from Kashmir to Kerala.

Taking a very different approach from rivals is another Bangaluru-based company, Ultraviolette Automotive, which plans to have a sleek, desirable motorcycle on roads by early 2020. Ultraviolette’s 200-250cc bike will have a top speed of 140 kmph and in tests can rev from 0-60 kmph in three seconds.

The bike comes with a portable charger and company founders Niraj Rajmohan and Narayan Subramaniam reckon on out-of-town trips like Mysore-Bengaluru it would be possible to use ordinary electrical points if there aren’t sufficient charging stations. Says Rajmohan: “We have to address a market looking for quality and performance and show an EV can outperform an IC engine.”

Big players not idling

The big manufacturers ruling the two-wheeler industry, meanwhile, aren’t just idling. They’re gearing up to tackle the changes racing towards them and spending heavily on R&D.

Also, they’ve been investing cannily so Hero MotoCorp has put around ₹330 crore into Ather Energy along with Flipkart’s Sachin Bansal and Singapore-based Innoven Capital. TVS Motor has a 25 per cent stake in Ultraviolette which is also looking at a range of other EV businesses. And Bharat Forge has just made a fresh investment to lift its stake to 48 per cent in Pune-based Tork Motors which is bringing out a high-performance motorbike.

Making an equally ambitious expansion is Greaves Cotton which wants to be “a complete EV ecosystem player” and has just bought Coimbatore-based Ampere Motors which has a range of three- and two-wheelers and just launched its lithium-ion-battery Zeal scooter.

“We’ll add products and capacity as the market grows,” says Greaves Cotton chief executive Nagesh Basavanhalli. Greaves Cotton reckons it can transform Ampere with its financial muscle and its 325 dealers around the country is slated to rise to 500 by the year-end. Ampere’s founder, Hema Annamalai, has stayed on but Basavanhalli says the company is “adding management depth in manufacturing, sales and retail” and looking at rapid nationwide roll-out.

Other companies, too, are looking at using EVs in different roles. Take Ola which has its Ola Electric division that’s running several pilot projects across the country. Ola says it will have 10,000 three-wheelers and two-wheelers on roads soon. “The company is primarily focussed on developing viable charging and battery-swapping solutions to make electric mobility work and feel better than internal combustion for end-users,” says Anand Shah, Ola’s Strategic Initiatives Senior Vice-President. Ola, incidentally, is one of the larger companies looking at three-wheelers. But there are almost two million three-wheelers in the unorganised sector.

China is the EV world leader, making 30 million electric two- and three-wheelers annually and the Indian government is now talking about a fast transition on the same scale. Several EV manufacturers who attended the NITI Aayog meeting are enthusiastic about the proposals.

Still, it’s important to underline India’s traditional two-wheeler industry is one of the most crucial, employing over one million people. Also, EVs require far fewer components which could mean the death or at the least huge weakening of ancillary-making companies — makers of drive-trains for instance — that could suddenly be redundant.

In the unorganised sector, the vast pool of mechanics would also suddenly find their services aren’t greatly needed. Says Vinnie Mehta, director general, Automotive Component Manufacturers Association: “We create three million jobs in components and the after-market. We also support a large informal repair-and-maintenance sector.”

Electric two-wheelers look set to win the battle of the roads but with the country facing mounting unemployment managing the transition fallout will be all-important. And fallout there will be. Says Rathore: “When you start working on a new technology, you’re on par with any start-up. Electric vehicles can be delayed for a few years but this is the future.”

Published on June 25, 2019
This article is closed for comments.
Please Email the Editor