Hero Electric looks at technology tie-ups, M&As

Chennai: Electric vehicle maker Hero Electric is looking for M&A options or technology tie-ups to bolster its next generation electric vehicle technology.

The company, which leads the roughly 42,000 unit strong electric two-wheeler vehicle market in India, is also lining up a series of new product launches but only after the Centre greenlights the long-pending National Electric Mobility Mission Plan (NEMMP) 2020. Sohinder Gill, CEO - Global Business, Hero Electric, said: "We are on the lookout for next generation technology. We may be acquiring a company or going in for a technology tie-up to bolster our stable. We are still hunting for that," he said.

The company — which has a whole range of electric two-wheelers like the best-selling Photon as well as Maxi, Cruz, Optima, Zion and E-Sprint models — is planning new launches as well as a foray into speciality vehicles once the NEMMP announcements come through in 2015. "We have no plans to get into four-wheelers or quadricycles but we will go into speciality vehicles like disability vehicles, etc and also launch more two-wheeler models once the NEMMP announcements come through next year," said Gill.

The company has just rolled out its latest product - Avior e-cycles at just under %Rs 20,000. "Customers are most concerned about in an EV is range and the fear of being stranded," said Gill. "With the e-cycle, that problem has been taken care of. Also, at just 33 kg it is light and the battery is detachable and can even be charged at home. We are targeting youngsters, couples, cycling enthusiasts," he added. Hero Electric's overseas operations already sell A2B electric cycles in developed markets.

India's electric two-wheeler segment, which saw growth double and quadruple thanks to the government subsidy has been in decline ever since the subsidy was withdrawn. Currently the electric two wheeler segment comprises less than 1% of India's nearly 15 million unit overall two-wheeler market. "Among the organized players we are biggest with more than 50% share of the market," said Gill.

The degrowth period has weeded out poor quality imported products from the Indian market. "Very little in electric two-wheelers is now imported. The battery and motor are still mostly sourced from China and Taiwan but everything else including shock absorbers, brake and lighting systems are all localized," said Gill.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.