Are EVs too ahead of their time in India?

Ather and Chetak — Perhaps the frontrunners to sketchy timing

Akhilesh Agarwal
Nov 6 · 3 min read

“Yeah, it’s awesome” he said snobbishly before he rode off on his shiny new Ather.

We tried talking to him about his new ride at St. John’s Church Road signal in Bangalore, but he seemed to be in a hurry.

Electric scooter startups seem to have blown up in India over the last two years with big names like Bajaj joining the existing ecosystem to come out with their own ride. Yep, the Chetak is back, but this time it’s all electric and could cost over 1L. The Chetak’s closest competitor is the Ather, priced close to 1.2L.

The two brands are currently poised to take a big chunk of market share from existing traditional players who sold over 67L scooters cumulatively in 2018. This is due to growing concerns of air pollution and the immediate need to find cleaner sources of fuel.

But, before trying to solve for air pollution, India has several infrastructural issues that need to be addressed to allow electric scooters to be more viable. Some very common issues include most Indians not having their own parking space, not enough charging stations to dock the electric vehicle to charge while on a trip, underdevelopment that doesn’t allow for retrofitting charging points in buildings and … the list goes on.

The price range of an electric scooter is between 70k — 1.3L rupees. Some quick math (67L units * 65k as average price per unit / 70 for exchange rate) reveals that the traditional scooter sector in India is worth close to $6bn — a massive market that any new age scooter incumbent should be eyeing to own.

But is this the market that electric scooter manufacturers can realistically aim at capturing? Certainly not. Apart from the above mentioned infrastructural issues another huge challenge in this sector is the inability to currently price vehicles at a level that is cost effective for the common user. Hence, the current market for electric scooters is well below $6bn. Maybe even lower than a fourth of this number. To be realistic, we have to account for these electric scooters currently being only viable in metros and tier 1 cities in India in the very least.

In fact, the more EVs we have, the better the energy generation has to be in the country. And the world is still heavily dependent on non-renewables like oil, coal and nuclear power to generate energy. And as you can guess, EVs draw significant energy to charge their batteries which puts additional load on the power grid. Here’s some simple logic — the higher the demand for something, the higher its price. With a greater number of EVs on the road, we can expect energy prices to increase until our power grid is able to supply enough energy efficiently enough to first take care of all basic needs and then new rush of charging EVs.

Hence, we are back to the infrastructural problem that will inhibit the boom of the EV ecosystem in India. It will be a very welcome change when there is enough development in the country to support its boom, but right now the electric scooters might be too ahead of their time.

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