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E-bikes To Zoom Past Fuel Price Hike
Posted by Pradeep Sadanapalli | May 28, 2008 | 790 views
(5 votes, average: 4 out of 5)
Loading ...Riding on the spiralling fuel prices, makers of electric vehicles, especially twowheelers run on batteries, are set for a roll.
An electric two-wheeler can run for around 70 km on a single charge, that costs anywhere between Rs 4 and Rs 5, and is environment-friendly to boot.
Hero Electric, a 100 per cent subsidiary of the Munjal’s Hero Group, alone is expecting to sell 70,000 units this fiscal year (FY), a number which all the 30 odd players in the market put together sold last year. The company, which launched e-bikes last March, sold 21,000 units in FY 2008.
The market for electric two-wheelers (e-bikes) is expected to grow by around 150 per cent in the current fiscal to 170,000 - 180,000 units from around 70,000 units sold in 2007-08, according to industry estimates.
In fact, leading two-wheeler makers of the country like TVS Motors, Kinetic and the Hero Group and some nonauto companies as well are rushing to cash-in on the soaring fuel prices and make electric two-wheelers. The latest to enter the bandwagon is Delhi-based Lohia group, which is setting up a Rs 150- crore facility in Uttarakhand to make two lakh units of electric scooters and three-wheelers per annum.
“The hike in fuel prices is having a big impact in enhancing our sales. So is the increase in awareness among consumers owing to growing penetration,” said Naveen Munjal, chief executive of Hero Electric.
The company, which recently doubled the capacity of its facility in Ludhiana to make 1.25 lakh vehicles per annum, is expanding its dealer network to 250-300 this year, from 120 at present.
“Schoolchildren, housewives, senior citizens and traders are among our main customers, who use it as a citybike,” said Uday Doshi, proprietor of GRA Automobile, a Hyderabad dealer of YO Bykes, electric scooters made by Ahmedabad-based engineering company, Electrotherm.
He said that many of these vehicles are below-250 W category and therefore do not require a driving licence, registration and payment of road tax, attracting these customers.
To add more power to the segment, many state governments including Delhi, Chhattisgarh and West Bengal have announced subsidies ranging
from 15-30 per cent on electric vehicles, as a part of their renewable energy development initiatives.
Companies, meanwhile, are working on improving the technology and price to make the electric vehicles more attractive. Better-performing batteries (lead batteries presently being used have a life of 400 charges), bringing down battery costs, rapid-charging battery stations and helplines for quick replacement of batteries are among what they are doing.
Indigenisation and bringing down imports to the minimum level, from over 60 per cent at present, has become a top priority for all the electric vehicle manufacturers.
“With reduction in value added tax (VAT) on electric two-wheelers to 4 per cent from 12.5 per cent in many states, including Andhra Pradesh and Karnataka, the retail price of our 500W two-wheeler model is likely to go down below Rs 30,000 per vehicle in the coming year, from Rs 35,000 per unit at present,” said Ajit Prasad, director of Bangalore-based Eko Vehicles Private Limited, which supplies the electric ‘Velocity’ scooters being marketed by the UK-based Ultra Motors.
Eko expects to make 5,000-10,000 units per month in the coming year, up from the current 2000 units it rolls out every month.
Companies are also addressing the problem of banks not extending loans to the under-250W two-wheelers, as traceability of these unregistered vehicles is a problem.
“We are talking to various banks to consider offering loans for our vehicles under the white goods category,” said Munjal.
SOURCES:
Times Of India
Topics: Latest Trends, New Pospects, Consumer Market, Travel |
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