After the government reduced subsidies for the vehicles, Ather Energy’s CEO Tarun Mehta told Reuters that the company will speed up the launch of new models domestically and test export markets while obtaining additional funding for further expansion.
The market for electric scooters in India is still small but expanding, with e-models making up 5% of all scooter and motorbike sales in the most recent fiscal year compared to the government’s objective of 70% by 2030.
However, the government suddenly reduced cash incentives on the cars in May from 40% to a maximum of 15% of the price before taxes, without providing any justification. E-scooter sales overall more than half the following month.
Mehta stated in an interview that the company is currently working on two new models, one of which would be launched six months earlier than originally planned. Ather’s sales also decreased but are now quickly rebounding.
“The transition to electric vehicles could have been faster if not for the (subsidy) change, but even then, there will be no major impact in the mid to long term,” he claimed.
This change requires us to accelerate new launches and increase our investment in product development, he continued.
By the end of the decade, Ather wants more than 50% of its revenues to originate from international markets as part of a long-term growth strategy, according to Mehta.
To complement its current two models focused at individual riders, Ather, India’s third-largest e-scooter manufacturer behind Softbank Group-backed Ola Electric and local TVS Motor, aims to introduce a scooter.
Ather, which is estimated to be worth $750 million, will raise additional funds before the end of 2023 to support its expansion objectives, he stated without going into further detail.
According to a person with firsthand knowledge of Ather’s plans, the business hopes to raise a sum comparable to the $108 million it recently received in a rights issue from existing investors Hero MotoCorp and Singapore’s sovereign wealth fund GIC.
In a few months, Ather will also test out export sales in one Asian region.
“India will not only be the largest market in the world for electric two-wheelers, but will also be the largest exporter,” he stated.
