Business Standard: June 06, 2018
Bengaluru: Hero MotoCorp-backed electric vehicle startup Ather Energy on Tuesday unveiled the final production variants of its first all-electric scooter 340 and 450 in Bengaluru, and announced that it would begin taking preorders for the vehicles starting the same day.
The highly anticipated vehicle whose launch has been delayed by over a year will retail for Rs 109,750 and Rs 124,750 respectively. While the 340 will have performance comparable to a 110 cc gasoline powered scooter, the 450 with higher performance would compete with 125cc scooters.
The Bengaluru-based firm said it was taking orders for the scooters only in the city and would begin making the first deliveries by August. It is targeting an initial production run of 2,000 vehicles from its factory in Whitefield on the city outskirts. The company is targeting enthusiasts, tech aficionados and people looking to cut their carbon footprint as its potential customers.
“In the last 4 years, we have not only built the scooter but an ecosystem for electric vehicles, be it the suppliers, partners, charging infrastructure and even the engineering talent to build the products,” said Tarun Mehta, co-founder and CEO of Ather Energy.
Both variants are identical in terms of design and even most components, with only performance being the differentiating factor. The 340 will have a range of 60 kilometers on a single charge, while the 450 will return 75 kilometers on a single charge.
The company also announced its Ather One subscription service which at Rs 700 a month will cover all charging costs incurred by a customer, maintenance, roadside assistance and even towards data charges for the bike’s connected dashboard. Ather says, even the cost of electricity which a customer will incur at home will be reimbursed as credits.
While the up-front cost of the scooters will be far higher than their gasoline powered competitors, Ather says it will also offer financing at just 8.5 per cent for up to five years. This will help offset the higher cost while allowing customers to use its EVs at a cost similar to that of a gasoline powered scooter which have higher running costs.
For the premium price, Ather is also offering features never seen in India’s scooter segment before, like a fully colour dashboard with inbuilt navigation, while the on-board SIM card will allow the company to roll out over-the-air (OTA) updates for the software and firmware, similar to what Tesla Motors does for its $100,000 cars.
Given India’s lacking strength in incubating hardware startups, Ather with its goal of building an entire electric vehicle has been one of the most widely watched startups in the country. The company boasts that its first scooters have been designed completely in-house and even the components that have been bought off the shelf have been customised to suit its needs.
“Except the motor and the cells, everything is pretty much designed in-house and almost all of it is localised. If you consider components, it is already like 90 per cent localized. In terms of value, the skew is a little different, but even this is going to improve over the next year or so,” added Mehta.
Ather is planning to refine its manufacturing process through the production of the first 2,000 vehicles for Bangalore. Early next year, the company plans to increase production to 250 units a week, after which it can ramp up production to as much as 650 units a week from its facility in Bengaluru.
Alongside the scooters themselves, Ather also manufactures its own battery packs, though the cells inside them are still imported. The company says unless the demand for EVs in India increases and large companies setup lithium-ion cell manufacturing units here, the cells will unfortunately have to continue to be imported.
Apart from building its own fully-electric bike, Ather is also building a grid for charging its vehicles while the company will even control the retail and after-sales experience by itself. It’s a similar model what Tesla founder Elon Musk proved for the high-end electric cars in the US, which is now a runaway success.
As for profitability, the company says it sees itself losing money on every bike it sells until it can ramp up production to around 50,000 units a year. Even then the company might not be profitable as it will continue sinking money into research and development of new products and servicing its existing fleet of vehicles on the road.
Ather says it is eyeing selling 100,000 units three years from now.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.