The government's objective is to see this percentage grow to 70 by the year 2030, and it's offering incentives to stimulate sales.
Ola Electric, the largest producer of electric scooters, introduced its most budget-friendly models on Tuesday, aiming to attract more customers as the price of e-scooters becomes more comparable to traditional gasoline models. Supported by the SoftBank Group, the company also has plans to unveil four electric motorcycles by the end of 2024. The new e-scooter variants, S1X and S1X+, will carry price tags of 99,999 rupees and 109,999 rupees respectively. Notably, the starting price of the S1X is approximately 36 percent lower than the costliest e-scooter offered by Ola, the S1 Pro, which retails for 140,000 rupees.
Comparatively, the most inexpensive gasoline scooter in India comes at around 64,000 rupees. Gasoline-powered two-wheelers constitute a significant portion of the country's automobile sales, surpassing 5 million units in the previous fiscal year. Among these, electric models accounted for roughly 15 percent, as per industry data.
The government aims for this proportion to expand to 70 percent by 2030 and is introducing incentives to stimulate sales. Ola has initiated the launch of more affordable scooters through an advanced generation platform, effectively lowering production expenses by 25 percent. According to Bhavish Aggarwal, the founder and Chief Executive, the company's move to a new platform has contributed to this cost reduction, as he communicated to Reuters.
Having entered the electric scooter market in 2021, Ola has taken on competition from startups like Ather Energy, and it currently leads the e-scooter sector with a market share of 32 percent. In the previous year, Ola was valued at $5 billion. Industry data reveals that between April and August 2023, Ola managed to sell approximately 95,000 e-scooters. While the introduction of the new models is anticipated to elevate Ola's market share, Aggarwal expressed that his primary goal is to enhance the penetration of electric vehicles in India. He aspires for electric models to constitute the majority of scooter sales by the upcoming year.
"Our ultimate objective is to eventually match the upfront cost of an electric vehicle with that of internal combustion engine models, even without relying on any government incentives." The company, which is preparing for its initial public offering (IPO), also has intentions to enhance its plant's yearly production capacity from the current 500,000 units to 2 million units. Additionally, the company plans to double the number of experience stores to 2,000.
Ola recorded an operating loss of $136 million with revenues reaching $335 million in the fiscal year that concluded in March 2023, according to Reuters' report. Nonetheless, Aggarwal noted that the business has achieved significant growth thus far and anticipates improved financial results, although he did not specify a timeline for this projection. Furthermore, Ola communicated the expansion of its service centers across India by an additional 100, increasing the total count to 500.
