Tag: ola electric

Ola Electric Expects to Quadruple Revenue This Financial Year, Reveal Company Documents

Indian e-scooter maker Ola Electric expects revenue to quadruple to $1.5 billion (nearly Rs. 12,300 crore) this financial year and then double that again in two years, according to a document containing corporate projections and people briefed on the matter.

The figures, however, pre-date surprise cuts by the federal government to e-scooter incentives in May. 

According to the document, which was prepared ahead of investor meetings for Ola’s planned IPO worth up to $700 million (nearly Rs. 5,700 crore) and was reviewed by Reuters, the company is also targeting $220 million (nearly Rs. 1,800 crore) in operating profit for the year to end-March.

The $1.5 billion revenue target compares with a result of $335 million (nearly Rs. 2,750 crore) for the past financial year, two people briefed on the matter said, adding that there had been no change to Ola’s internal estimates since the document was drawn up in April.

Ola, which is backed by Japan’s SoftBank Group and Singapore’s Temasek, did not respond to repeated requests from Reuters for comment.

Since it began sales in late 2021, Ola has become India’s e-scooter market leader with a 32 percent share, competing with Ather Energy as well as companies like TVS Motor and Hero Electric. It was valued at $5 billion (nearly Rs. 41,000 crore) last year and has raised nearly $800 million (nearly Rs. 6,650 crore) from investors since 2019.

Incentives slashed

The Indian government has said it wants electric variants to account for 70 percent of two-wheeler sales — which also include motorcycles — by 2030, a huge jump from 14 percent currently.

But in May, it shocked the market by slashing e-scooter cash incentives without explanation, saying it would pay just up to 15 percent of the price before taxes. It had earlier pledged to pay up to 40 percent.

In June, industry-wide Indian sales of e-scooters more than halved from May to a six-month low of 45,800 units, government data showed.

“The subsidy cut poses a roadblock for all (e-scooter) companies’ growth because prices for the consumer have increased. Revised projections have to be applied, which will also hit valuations,” said Jay Kale, a vice president at Elara Capital.

But in an interview last week with India’s Business Standard, Ola CEO Bhavish Aggarwal said he was not fazed by the subsidy cut and said last month’s slide in industry-wide sales was just a “short-term blip”.

“The current subsidy after reduction is the right amount”, Aggarwal was quoted as saying, adding that the company could “live without” such incentives.

According to the document seen by Reuters, Ola has estimated it will sell 8,82,000 scooters this financial year and 2.9 million in two years time.

In contrast, KPMG in a June report forecast this financial year’s e-scooter demand at just 1 million units, a third lower than previously estimated. It predicts industry-wide sales of just 2 million in two years time.

For the quarter just ended, Ola sold 68,316 e-scooters, industry data shows. That’s 17 percent below the 82,000 estimate in the document seen by Reuters.

The document shows Ola aiming for revenue of $3.9 billion (nearly Rs. 32,000 crore) and operating profit of $578 million (nearly Rs. 4,700 crore) in two years.

For its IPO, Ola is working with Goldman Sachs and Bank of America among others, and has started early meetings with investors to brief them on the company’s plans.

© Thomson Reuters 2023

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Ola Advances Plan for IPO as EV Scooters Take Off in India, Plans to Unveil Electric Car in 2024

Ola Electric Mobility is in line for an initial public offering sooner than its founder previously imagined, reflecting the Indian startup’s whirlwind pace of growth since it started selling electric scooters in late 2021.

“I thought it would take me four to six years of revenue to go public,” Founder and Chief Executive Officer Bhavish Aggarwal said in an interview while sipping iced Vietnamese coffee in New Delhi’s bustling Connaught Place. “Now I can feel that it will be much earlier. Ola Electric has grown and matured faster than I had initially planned because the market response has been very strong.”

The company, whose backers include SoftBank Group and Tiger Global Management, has become leader in India’s electric-scooter market with a 38 percent share. It has sold more than 239,000 electric scooters since December 2021, according to data from the Society of Manufacturers of Electric Vehicles.

While demand initially came from first-time scooter buyers, most of Ola Electric’s customers now are already fully-fledged converts, said 37-year-old Aggarwal, dressed in a black Nehru jacket, popularized by India’s first Prime Minister Jawaharlal Nehru and later, The Beatles.

Branching out

Aggarwal has ambitions to expand, with plans to unveil a motorbike by the end of this year and a battery-powered car in 2024, though the timelines may change. He also continues to consider exporting scooters to Southeast Asia, Latin America and Europe, a proposition that got waylaid because demand at home was so strong, according to Aggarwal, whose first startup, ANI Technologies, runs Ola ride-hailing operations.

Ola Cabs got as far as selecting banks for a $1 billion (roughly Rs. 8,217 crore) IPO in Mumbai, Bloomberg News reported in August 2021, but that never materialized. The company, which competes against Uber Technologies Inc., is a “profitable business for us now,” Aggarwal said in last week’s interview in Delhi. He didn’t comment on any renewed attempts to list, nor did he mention a date for a possible Ola Electric IPO.

Aggarwal is building a 115-acre battery factory in southern India, pitting him against billionaire Mukesh Ambani’s Reliance Industries, with the aim of making lithium-ion cells primarily for Ola Electric vehicles, as well as potentially offering energy storage and home energy solutions.

Manufacturing EV components in-house will help Ola Electric sell cars on a bigger scale and increase margins, said Aggarwal, who graduated from the Indian Institute of Technology in Mumbai. Designing vehicles from scratch will give the company more control of quality and costs in a market where most EVs are converted from gasoline models, he said.

Achieving success in electric cars won’t be easy. Combustion-engine vehicles remain the favored mode of personal transport in India and dominate the country’s roads. EVs have been held back by the country’s lack of charging facilities and their high price tags. Nationwide sales reached 49,800 last year, just 1.3 percent of the 3.8 million passenger vehicles sold, according to BloombergNEF.

Bengaluru-based Ola Electric is up against more experienced manufacturers such as market leader Tata Motors, Mahindra & Mahindra and even Elon Musk’s Tesla, which is considering investing in India.

Bumps in road

Ola Electric’s scooter business has also been affected by delivery delays due to chip shortages, and issues with quality and fire. Sales slid 39 percent in June from previous month to 17,590 units, a trend that affected other automakers too after the government trimmed subsidies that were offered under its Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles program.

Still, better technology has shortened timelines for getting a product to market, according to Aggarwal. Ola Electric uses digital simulation and artificial intelligence in manufacturing to save time. “I’m building a technology-focused group of companies,” he said. “Another big technology theme of our generation will be computing and AI. So we’ll do something.”

Being a so-called flat organization also speeds up the production process, said Aggarwal, who is involved in daily decision-making at his business, which employs about 7,000 people.

“What would take a month in a company, we get it done in a day,” he said. “Our philosophy on execution is that we want to do things as best as possible without any compromises on quality or safety. And do it at the lowest cost possible and the fastest speed possible.

Aggarwal believes his strategy to take control of various stages of the EV supply chain will reduce costs and improve product performance and design.

“Tesla is for the West, Ola is for the rest,” he said.

© 2023 Bloomberg LP

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Ola Electric Says It Will Reimburse Charger Cost to EV Scooter Buyers; No Details on Refund Amount

Ola Electric on Thursday said it will reimburse its buyers of electric scooters the cost of chargers.

In a statement on Twitter, the company said the electric vehicle industry has witnessed unprecedented success in the last couple of years despite attempts from vested interest groups, like the recent narrative on charger pricing.

“As a leader of the industry we remain committed to putting our customers first. Therefore, setting aside the technicalities and as an example for others to follow, we have decided to reimburse the charger monies to all eligible customers,” it stated.

This move will not only demonstrate the company’s commitment to the EV revolution but also serve to strengthen trust and add more value for the customers, the company noted.

Ola did not provide the details regarding the amount it planned to reimburse.

Earlier reports, citing government officials, had pegged the amount to be around Rs 130 crore.

On Wednesday, TVS Motor Company announced that it will refund around Rs 20 crore as a goodwill benefit scheme to customers who have paid over and above the threshold limit fixed under the FAME scheme.

Last week, the government sent notices to Okinawa Autotech and Hero Electric for debarment from the FAME-II Scheme and sought the recovery of incentives claimed since FY20 after the two companies were found to be violating localisation norms under the scheme.

Based on anonymous emails, the government has recently re-opened audits for 2020 and 2021 where all companies were importing certain components which weren’t manufactured in India.

The FAME II (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles in India) scheme commenced on April 1, 2019, for a period of three years, which was further extended for a period of two years up to March 31, 2024.

The total outlay for FAME Scheme Phase II is Rs 10,000 crore. The scheme is exclusively for public and commercial transport in the segments of electric three-wheelers (e-3W), electric four-wheelers (e-4W), and electric buses. 

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Ola Electric to Invest $920 Million in Tamil Nadu to Manufacture Electric Cars, Batteries: Details

SoftBank Group-backed Ola Electric would invest $920 million (roughly Rs. 7,600 crore) in the southern Indian state of Tamil Nadu to manufacture electric cars and batteries for electric vehicles (EVs), a state government statement said on Saturday.

Ola will invest $920 million (roughly Rs. 7,600 crore) through its subsidiaries Ola Electric Technologies and Ola Cell Technologies, drawn to the growing demand for EVs in India.

The company’s cumulative production numbers topped 100,000 in November, and it plans to annually make 140,000 cars and hire 3,111 workers in Tamil Nadu through the new investment. Ola already manufactures e-two wheelers in the state.

In September, Ola said it was looking to expand into Latin America, ASEAN and European Union countries after entering India’s neighbour Nepal first.

Tamil Nadu, which accounts for nearly a third of the country’s automotive exports, is looking to boost EV manufacturing and is waiving road tax, registration charges and permit fees for EVs, according to a policy unveiled this week.

On February 9, Ola founder and CEO Bhavish Aggarwal said that Ola Electric will open 500 experience centres across India by March. The firm, currently has 200 experience centres in India and is planning to launch an electric bike, according to a PTI report.

Earlier this week, the Tamil Nadu government became the latest state to unveil its electric vehicle (EV) policy for 2023 which aims to garner investments to the tune of Rs. 50,000 crore and generate 1.50 lakh jobs, in a boost to the EV industry.

The policy was launched in the backdrop of the government expecting battery operated vehicles to play a crucial role in the electrification of last mile connectivity.

During the last five years, the state has transformed into a leading EV manufacturing hub with new entrants including Ather Electric and Ola Electric having set up their production facilities in Tamil Nadu.

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Tamil Nadu Becomes Latest Indian State to Unveil Electric Vehicle Policy

The Tamil Nadu government on Tuesday unveiled its electric vehicle (EV) policy 2023 which aims to garner investments to the tune of Rs. 50,000 crore and generate 1.50 lakh jobs, in a boost to the EV industry.

Chief Minister M K Stalin formally released the new policy in the presence of government officials at the Secretariat.

The policy was launched in the backdrop of the government expecting battery operated vehicles to play a crucial role in the electrification of last mile connectivity.

“To support this goal, Tamil Nadu aims to electrify the vehicular fleets operating in the State by leveraging its vibrant automotive ecosystem comprising original equipment manufacturers, auto component ancillaries, highly skilled workforce and robust R&D capabilities,” the policy document said.

During the last five years, the state has transformed into a leading EV manufacturing hub with new entrants including Ather Electric and Ola Electric having set up their production facilities.

According to the policy, Tamil Nadu has signed memorandum of understandings with companies committing investments of nearly Rs. 24,000 crore and employment potential of 48,000 jobs in the EV value chain.

The state government is cognizant of the sectoral challenges and seeks to address these through interventions mapped out across the supply, demand and ecosystem segments in this policy.

“Tamil Nadu has a vision of attracting Rs. 50,000 crore worth of investments in EV manufacturing, creation of 1.5 lakh new jobs, and development of a robust EV ecosystem in the State,” the document read.

The new policy shall be valid for a period of five years.

It also mentioned that the government would encourage adoption of electric vehicles in the state with 100 percent road tax exemption among others.

“100 per cent road tax exemption will be provided till December 31, 2025 for the EV battery operated vehicles — two wheelers, private cars, three-seater auto-rickshaws, transport vehicles, light goods carriers.” The state government would develop industry-academia linkages to create a skilled workforce pool for EVs besides promoting Chennai, Coimbatore, Tiruchirappalli, Madurai, Salem, Tirunelveli as pilot cities for implementing ‘e-mobility solutions’.

The policy also proposes to support electrification of commercial and public transport fleets. It offers several incentives to companies engaged in manufacturing of EVs including, ‘reimbursement of SGST’, turnover-based subsidy and capital subsidy.

Electric vehicle projects undertaken by the company would be entitled to 100 percent exemption on stamp duty on purchase or lease of land obtained from the government.

State Transport Undertaking operated buses which constitute a substantial percentage of the public transport India would be electrified through a phased augmentation and replacement plan. “The state shall endeavour to increase the share of electric buses to 30 percent of the fleet by 2030”, the policy said.

 

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Tesla’s Former India Policy Chief Said to Join Ather Energy as Vice President

Tesla’s former India policy chief is joining homegrown electric scooter startup Ather, one of the best-funded fledgling firms in a sector attracting record investment.

Manuj Khurana, who quit his post as Tesla’s local head of policy and business development in June, will start next week at the firm based in the southern technology hub of Bangalore, a person with knowledge of the matter told Bloomberg News. Khurana will join as a vice president, though his specific role there is unclear, the person said, declining to be named as the matter is not public.

Ather, which competes with local rivals including Ola Electric, this year raised $128 million (roughly Rs. 1,050 crore) from investors including Hero Moto, and India’s National Investment & Infrastructure Fund. It’s one of several players vying for a slice of a market expected to surpass $150 billion (roughly Rs. 12,33,900 crore) by the end of the decade — roughly 400 times its current size.

Representatives for the startup didn’t immediately respond to a request for comment.

Indian consumers are expected to gravitate toward electric vehicles as the nation combats some of the world’s worst pollution. Venture capital and private equity funding in Indian electric mobility firms is on track to exceed $1 billion (roughly Rs. 8,225 crore) for the first time in 2022 as sales rise steadily, according to Bloomberg New Energy Finance.

Khurana had joined Tesla in March 2021. The US electric automaker, run by billionaire Elon Musk, has faced a raft of challenges in India over import taxes and a local factory. It’s sought lower levies in India so it can test the market by selling cheaper imported electric vehicles before committing to a manufacturing base of its own.

© 2022 Bloomberg LP

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Hero’s First Electric Scooter Hero Vida Launched, Bookings to Begin From October 10

India’s Hero Moto, the world’s biggest motorcycle maker by sales, launched its first electric scooter worldwide on Friday as it looks to catch up with newer businesses that have taken the lead in the shift to cleaner transport.

Like some other legacy automakers in India, Hero has been a laggard in launching electric two-wheelers, giving startups such as Ather Energy, which is backed by Tiger Global, and Softbank Group-backed Ola Electric a first-mover advantage.

“While it may have been our wish to launch this product earlier than we have, we had to get it absolutely right for the greater good of everyone,” Chairman Pawan Munjal told reporters at the launch event in Jaipur.

India wants e-scooters and e-bikes to make up 80 percent of total two-wheeler sales by 2030, from about 2 percent today.

While sales are accelerating as people move away from gasoline scooters in the face of rising fuel prices, a recent spate of electric scooters catching fire have raised concerns over safety, jeopardising consumer confidence.

There are concerns this could derail growth of a sector that is key to the country’s carbon reduction goals.

Prices for Hero’s debut model, Vida Plus, will start at Rs. 1,45,000 rupees — higher than most electric scooters in India — and it will have a minimum range of 143kms on a single charge, similar to Ather.

The company has made a string of investments in electric vehicle startups. In September, Hero said it would invest $60 million (nearly Rs. 500 crore) in California-based Zero Motorcycles to jointly develop electric motorcycles. In January, it announced an investment of more than $56 million (nearly Rs. 460 crore) in Ather and in 2021 it partnered with Taiwan’s Gogoro for its battery sharing infrastructure.

Hero will start taking bookings on October 10 and deliveries will begin in December.

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Ola to Cut 10 Percent Engineering Jobs Across Ride-Hailing, Electric Vehicle Manufacturing Businesses: Details

India’s Ola will cut about 200 engineering jobs to reduce redundancy across its two main businesses of ride-hailing and electric vehicle manufacturing, the SoftBank Group-backed company said on Monday. The company said it is focussed on being a “vertically integrated mobility company” and is centralising operations to build a structure to strengthen relevant roles and functions. “Ola is building on common capabilities and synergies across functions as it strengthens its play across two-wheelers, four-wheelers, cell research and manufacturing,” the company said in a statement.

To that end, said Ola, it plans to boost its engineering workforce to 5,000 over the next 18 months from around 2,000 currently, as part of an “influx of hiring” for roles in vehicle engineering, sourcing, product management and data science.

Ola, which pipped Uber to take a majority share of India’s ride-hailing market, started manufacturing e-scooters last year and plans to start producing electric cars in 2024.

However, its scooter business came under scrutiny earlier this year when Ola recalled more than 1,400 of the vehicles after one of them caught fire.

The company also postponed plans to go public in the first half of this year, possibly due to volatility in the market and lacklustre listings of other domestic start-ups.

Last month, it was reported that Ola Electric planned to launch its first four-wheeler electric vehicle in the Indian market in 2024. The first electric car from the company is claimed to offer a range of over 500km on a single charge and go from 0-100kmph within 4 seconds. As previously mentioned, the firm made its entry into the EV space last year with the launch of Ola S1 and S1 Pro electric scooters.

© Thomson Reuters 2022

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Ola Electric Upgrading VCUs on Older S1 Pro Electric Scooters to Avoid Further Recalls: Report

Ola S1 Pro electric scooters are reportedly receiving an upgrade to the vehicle control unit (VCU) in order to accommodate future updates and to mitigate heating issues, pre-emptively preventing further recalls. New Ola S1 Pro units are being shipped with an upgraded VCU with more RAM and onboard storage, according to a report. The company is also tipped to soon perform VCU upgrades for older units. The company, which issued a recall of 1,441 electric scooters last month, is yet to announce any plans to upgrade the VCU on units that have been sold in the country.

According to a report by 91Mobiles citing tipster Yogesh Brar, Ola Electric could soon adopt a recall schedule or perform home visits to in order to upgrade the VCU on electric scooters that shipped before March. The older VCU available on those models does not have enough RAM and storage for future updates, according to the report. The revelation comes amid multiple complaints from users claiming their scooter switches on reverse mode or shuts down automatically, and an instance of the company’s Ola Electric S1 Pro scooter catching fire in Pune in March.

The purported new VCU that is being used by the SoftBank-backed company on new and existing Ola S1 Pro scooters is said to have more RAM and onboard storage — enough to accommodate updates in the future. However, it is worth noting that the company has not revealed any plans to perform upgrades to units that have been shipped, or a change in the VCU configuration for future units. Gadgets 360 has reached out to Ola Electric and will update this article when the company responds.

The report does not specify the specifications of the new VCU. When the Ola S1 and Ola S1 Pro were launched, the company had revealed that the VCU was powered by an octa-core processor with 3GB of RAM, and offers 4G, Wi-Fi, and Bluetooth connectivity. The company’s official website currently lists the available RAM as 3GB.

When the Ola S1 Pro was launched, the company had also revealed that it would be equipped with a Battery Management System that “actively monitors the battery for optimal durability, performance, range and safety.” According to the tipster, the company is closely monitoring the health of battery cells and battery packs, which can be controlled via the VCU. With several important aspects such as speed, thermal levels, charging control, voltage, power efficiency, diagnosis and monitoring controlled by the VCU, the upgrade could allow for improved software updates that could address some of the issues affecting Ola S1 Pro owners, according to the report.

Last month, Ola Electric stated it would recall 1,441 of its electric scooters, weeks after one of the company’s vehicles caught fire, which prompted an investigation into the incident. The company revealed that it would conduct a diagnostic and health check of scooters in a specific batch, and issued a recall of 1,441 vehicles. The firm had also revealed the preliminary assessment of the vehicle that caught fire revealed that it was an isolated one, and that the recalls were a pre-emptive measure.

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