MUMBAI – Indian Riding Service Ola, one of the largest start-ups in the country, is preparing a 10-million-unit-per-year electric motorcycle manufacturing facility in southern India with the aim of joining major players like the US. Tesla and Nio China in the e-movement space.
Built with an investment of 24 billion rupees ($ 332 million), the factory will serve as the company’s global manufacturing hub for the range of electric and two-wheeled scooters [for] across India and international markets including Europe, the UK, Latin America, Asia Pacific, Australia and New Zealand, ”Ola said in a statement.
The Bangalore-headquartered company, backed by SoftBank Group Japan, will complete phase one of the Future Factory by June, with a production capacity of 2 million units per year; The entire facility is expected to be completed by 2022. The factory, built on a 202-hectare site in the state of Tamil Nadu, will have 10 production lines, and will launch a scooter every two seconds at full capacity.
The company says it will contribute to Prime Minister Narendra Modi’s vision of “AtmaNirbhar Bharat” (India’s autonomy), as well as support India’s sustainability goals.
“(Our plans are) big, bold, and global with the goal of being a leading technology-driven sustainable mobility company. It’s transformative, rather than incremental. It’s global, rather than just It ‘s on a large scale, instead of playing on the fringes, “the company told Nikkei Asia in an email response.
From initially making e-scooters, Oil will expand to making a wider range of electric motorcycles in the coming years. (Photo courtesy of the company)
For Oil, the e-motorcycle industry will be a major expansion from its traditional surfing industry, which it started ten years ago. Ola currently serves more than 250 cities worldwide through a wide range of over-the-counter vehicles, auto-rickshaws, weighted taxis and cabs, through more than 2.5 million affiliate drivers .
Oil, officially listed as ANI Technologies, has so far raised $ 3.8 billion from global powerhouses such as SoftBank, Tencent Holdings in China and Tiger Global Management. The company was valued at $ 6 billion, according to Hurun Global Unicorns 2020. It was ranked fourth in India after Paytm, Oyo and Byju’s.
Ola has been making its first public offering in the last two years. Co-founder and CEO Bhavish Agarwal has repeatedly called for a public listing of its shares to take place in India. In a recent interview with Bloomberg, he reiterated his plan to hit the stock markets in the next 1-2 years.
From initially making e-scooters, the company will expand to making a wider range of electric motorcycles. In February, it selected Swiss-based ABB as one of its key partners for robotics and automation solutions for the main lines of its factory’s manufacturing process, including its paint and welding lines. ABB robots will be used for the battery and motor assembly lines.
In preparation for its global e-vehicle push, Ola Electric Mobility hired Ola manufacturing arm, former General Motors officer Jose Pinheiro as head of global manufacturing and operations and Julien Geffard as director of its strategy to go to market to direct its European operations. . In May last year, he bought Etergo BV a startup electric scooter based in Amsterdam.
Oil Co-Founder and CEO Bhavish Agarwal (Photo courtesy of company)
“The future of mobility is mobile, and the post-COVID world allows us to accelerate the adoption of global electric mobility,” Agarwal said.
“Every year, the number of two-wheelers sold almost twice the world compared to cars. With electric capabilities, digitally connected, two-wheeler will once again emerge as the best urban mobility paradigm with them worldwide and empowering all users .. We look forward to building the best global capabilities in engineering, design, and manufacturing for these products. do here in India. “
CARE Standards Inspector Vahishta Unwalla pointed out that not only India but a growing number of other countries around the globe are now pushing towards EV adoption. “Oil’s establishment of its manufacturing base in India is going well for the country’s sustainable mobility goals, as it attracts more investment and creates jobs in the region and also helps to ‘generate export revenue for our country,’ ‘she said.
However, Ora’s bold move has its challenges. India’s e-vehicle adoption is still at a lower level, although several appliance manufacturers like Tata Motors and Mahindra & Mahindra have embarked on a strong transition.
According to a Prescient & Strategic Intelligence report, the annual sales volume of two-wheeled electricity is expected to reach 1 million units by the end of 2025, up from 152,000 in 2019. However, this is a very small number compared to Oil intended production capacity.
“The challenge for the company will be in the form of rapid EV adoption from consumers, as Indians are price conscious and need a good enough incentive to move to EV where they need to haul higher cash. out of their pockets compared to a petrol vehicle, “said CARE Ratings’ Unwalla.
In the fiscal year ended March 2019, more than 21 million motorcycles were sold in India, the largest number in the world. © Reuters
“The company is also expected to face competition from major established players like HeroMoto Corp., Bajaj, etc. who have credibility in the Indian automotive market,” she said.
Even if Ora sells its products outside India, there is no guarantee that consumers all over the world will immediately accept its electronic products.
Although Ola has not yet announced the prices of its scooters, some media reports suggest it could be less than 100,000 rupees. According to a report by Autocar India, Splendor Hero MotorCorp was the highest selling bike in the financial year ended March 2020. The model is priced at 67,000 rupees. The top 10 products on the list are priced from 67,000 rupees to 90,000 rupees.
Gulzar Harrison, a Goa resident and strong motorcyclist, thinks it is a good idea to switch to electric bikes as fuel prices rise and his desire to reduce his carbon footprint. However, he said, “I’m still not sure the batteries are distributed in an environmentally safe way.”
Trupti Shah, who owns the Electric Wheels showroom chain in Mumbai, told Nikkei Asia that high gasoline prices have created a big spike in the use of electric scooters and motorcycles. But none of the around 300 products offered in the market are 100% manufactured in India, Shah said.
“If it’s not done in India, access to parts and scooters becomes a problem. I was facing it three times during the lockout,” Shah said. “We look forward to the Oil ecosystem to make electricity transfer convenient, reliable and affordable. “