To make room for mass-market models, manufacturers are looking at a significant ramp up in their capacities over the next two years, they said.
Mumbai: Established electric scooter makers including Ather Energy, TVS Motor Co, and Bajaj Auto aim to ride in more affordable, low-cost variants of their existing models over the next 12 to 18 months, said people who are privy to the plans.
To make room for mass-market models, the manufacturers are looking at a significant ramp up in their capacities over the next two years, they said.
The execution of the next phase of the growth strategy comes as the brands have managed to seed the market with their top-of-the-line models. This is even as the competition in the segment has notched up with the entry of a flurry of startups over the last two years. Most of the models currently are priced above Rs1 lakh. Companies are looking to hit the sweet spot of Rs70,000-80,000 by launching models with less-powerful motors.
Bajaj Auto, which entered the segment with its flagship Chetak brand in 2020 and has not been able to ramp up at a good pace due to supply chain issues, has aggressive plans to recoup some of the ground it has lost to rivals.
The Pune-based company plans to have a portfolio of five scooter models, all to be positioned below the existing model. This would help it corner close to 15% of the electric two-wheeler market by 2024-25, said people aware of the plans. The first of these affordable e-scooters, code named H107, is expected to hit the production lines in the next fiscal year and will have an initial volume of 2,000 units a month, ramping up to 10,000 units a month.
In response to an email, Bajaj Auto executive director Rakesh Sharma said as penetration of electric two-wheelers grows and the EV segment expands, one will also see the emergence of sub-segments driven by different use cases. These sub-segments will acquire a critical mass enabling specific product development.
“We have been monitoring this growth and will be introducing new products in the Chetak portfolio as well as with our strategic ally, Yulu, to address the new segments. Given the proliferation of the brands, particularly at entry level, even for the sub-segments we will continue to offer robust and differentiated propositions which may require premium pricing,” said Sharma.
TVS Motor, which has a 14.5% share in the market with its i-Qube model and sells an average 9,000 units a month, is working on an affordable model with lower specification. It is expected to start production of the model (referred to as U546 internally) in January 2024 and is looking at a monthly run rate of 25,000 units, said people aware of the company’s plans. An email sent to the company remained unanswered.
Ather Energy, the fourth largest in the pecking order, too, has plans to bring in a low-cost model. It is expected to start production of its model, codenamed 450U, sometime in 2024 and will have a monthly production rate of 30,000-33,000 units, said people aware of the company’s plans.
Ravneet Phokela Chief Business Officer, Ather Energy said Ather will continue to expand its product portfolio to address different consumer segments. “Currently, we have a very successful 450 platform and we feel that it is yet to unlock its full potential. The product has been getting enhanced on a regular basis because of our ability to introduce new features through software upgrades,” he said. Also, since the company is still in the process of expanding our distribution, a large proportion of its consumers haven’t even experienced the product yet.
“We have a robust product pipeline but we want to maximise the potential of the Ather 450X and Plus, before we roll out new products,” said Phokela.
A rapid pace of electrification in the electric two-wheeler market is also prompting the companies to introduce mass models. Led by Ola Electric, battery-operated two-wheelers accounted for 4% of India’s domestic two-wheeler market in 2022. Within that, the penetration of e-scooters has been much faster at 15%.
Keyword: E-scooter makers plan to power up portfolio with more affordable models