Electric scooters will grab 20% share of the two-wheeler segment by FY23

Electric scooters will account for 20% of the overall two-wheeler market by the end of the current financial year, said Tarun Mehta, co-founder and CEO of Bengaluru-based Ather Energy. He made the remarks while delivering the keynote address at the Forum Autocar Professional EV.

“We are seeing good demand on all fronts, and that is 2 to 3 times the supply,” he added.

Electric scooters have gone from 3-4% market penetration in the scooter segment to 12% in the space of 6 months, Mehta said, adding that “what we are looking for is almost 25-30 % market penetration in the next 12 months”. 18 months”.

India’s electric vehicle market has come a long way in the past nine years, from buyers hesitant about electric vehicles to queuing up to buy one, he said. Ather Energy, which was established in 2013, had to set up experience centers to convince potential customers that “electricity is not a toy”.

“When you zoom in today, we see a reverse situation where demand exceeds supply,” Mehta said. Also unexpectedly, the first users have now come from Tier 2 and Tier 3 cities, because “cost awareness is a national phenomenon”.

Explaining this trend which is only expected to grow, Mehta said growth is being seen in Tier 2 and Tier 3 markets because unlike their cramped urban counterparts, they have freestanding homes where access to an outlet 5 amp charging is not very difficult. “The issue of charging infrastructure doesn’t arise for two-wheelers there,” he said.

However, Mehta said he is confident that one in five two-wheelers sold will be an electric scooter at the turn of the fiscal year, as demand from metros also increases. “Electricity is aspirational because it’s connected to new technologies and that’s what people want to buy when they walk into EV experience centers expecting to be wowed by what they’ll see,” said he declared.

Battery Safety
Regarding the recent scooter fires, Mehta was adamant that electric vehicle battery safety must be part of the future roadmap for electric mobility in India. “Electric vehicle fires are certainly not pretty,” he said, referring to recent incidents involving electric scooters, a truck carrying electric scooters and a fire in a showroom. Nearly a dozen fires involving electric scooters have been reported in various parts of the country in the past eight to nine months.

In his remarks, Mehta attributed the incidents to a large-scale application of lithium-ion on electric two-wheelers. Current battery designs, he pointed out, are not very well designed for India. The Indian thermal scenario is much more penalizing than that of China or Taiwan or Korea from where these packs are often imported. More importantly, battery quality is one of the reasons for the recent fires. The first electric scooters were powered by lead acid batteries

In his view, battery chemistry plays “little or no role” in causing a fire. At most, he said it affects performance and can stall the vehicle. It’s the build quality that matters most, he says.

Design and manufacturing tests
This is why, according to him, efforts must be made on the design of the pack, the battery management system and the quality of assembly and manufacture. That’s what many entrepreneurs don’t realize and don’t focus enough on battery quality, he added. The importation of equipment not designed for the Indian climate, from other markets and poor quality equipment has contributed to the recent incidents, he said.

“We have to put a lot of effort in manufacturing design as well as functional testing, for which it takes at least 3-5 years for a packaging design to mature in the Indian conditions compared to 8-10 months , which is one of the reasons for the fires,” Mehta said.

Putting his remarks into context, Mehta said that if one in three or four customers in the country buys electricity, people’s expectations will change. There would also be supply chain and talent implications. India, he said, will be at the center of the electric vehicle transition globally.

Political issues
Regarding the role of government, Mehta said that as the country develops its electric vehicle sector, there is an opportunity for government to work closely with industry. “We need a policy suited to India’s social and environmental conditions,” he said.

Going forward, Mehta said issues such as finance and insurance would not be a problem. The real challenge for the sector will be when subsidies start to dry up in the next 2-3 years. In his opinion, “while some people think the industry will be able to stand on its own, the truth is that it won’t.”

Manufacturers of electric vehicles currently receive subsidies in the range of Rs 60-70,000 from Central and State governments. The challenge for EV makers is to build a robust business model without the subsidies and not compromise affordability on a like-for-like comparison with an ICE scooter. “This will be the real litmus test for all EV players, including Ather,” Mehta signed.

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