Hero MotoCorp is planning to invest an additional Rs 140 crore in Bengaluru-based Ather Energy, which will increase its stake in the smart electric two-wheeler manufacturer by three percent – to 39.7 percent.
Hero was the last of the three legacy two-wheeler manufacturers to enter the EV market with its Vida electric scooter in October 2022, over two-and-a-half years after Bajaj Auto and TVS Motor Co launched their Chetak EV and the iQube, respectively, in January 2020.
Ather Energy is engaged in designing, manufacturing, producing, selling and servicing of its electric vehicles and charging infrastructure. It also has storage, distribution and management systems of all forms of electric power (including energy in the form of batteries) and other ancillary services.
Ather's rapid growth is in tandem with that of the Indian electric two-wheeler market. The industry's cumulative January-November 2023 sales (7,83,128 units) are up 38 percent YoY and a 24 percent improvement over the whole of last year’s (CY2022) sales of 631,461 units. Expect the industry to surpass the 8,50,000 units mark for this year and set a new benchmark.
As a result of the rise in demand for its e-scooters, Ather’s turnover jumped 336 percent year-on-year in FY2023 to Rs 1,806.1 crore from Rs 413.8 crore in FY2022.
In the first 11 months of 2023, Ather Energy is currently the third-ranked EV maker, after Ola Electric and TVS Motor Co. Between January and November 2023, the company had retailed 97,900 units, which gives it a 12.50 percent share of the e-two-wheeler market. However, with an aggressive Bajaj Auto hard on its heels, Ather is getting ready to protect its turf with the launch of the new Apex 450, which is set to be the quickest and most powerful Ather yet.
Getting future ready
Ather Energy is well placed in terms of manufacturing capacity to cater to future demand. On November 23, 2022, the manufacturer inaugurated its second manufacturing plant at Hosur in Tamil Nadu, increasing its capacity to 4,20,000 units per annum.
The new plant employs 1,600 personnel, is twice the size of the first plant, and has two vehicle and five battery lines. Increased automation levels mean assembly times are down by 20 percent.
Retail network expansion
Ather Energy aims to double its market share to 30 percent with two new e-scooters that are slated for market introduction in FY2025. The company says it is developing a new platform, which will spawn a brand-new product before next year’s festive season, and another model shortly after that. "We are going to introduce two strong products, very different from the Ather 450X, which is going to remain our performance line," Ravneet Singh Phokela, chief business officer, Ather Energy, told our sister publication Autocar Professional in September.
"There are lots of other spaces that we haven't explored yet. While the 450X continues to remain sharply focused on performance, we are looking at getting into new categories. That expands the market opportunity quite dramatically for us. We should have something in the market in the next three quarters (around Q1-Q2 FY2025), and another one a few quarters down the line," added Phokela.
On the retail network front, Ather Energy at present has around 150 experience centres across 100 cities. It plans to expand the countrywide network to 120 cities and 200 outlets by end-FY2024. While it will refrain from going into deep rural areas, Ather Energy is confident that its upcoming products will strengthen its potential in Tier-2, Tier-3, and Tier-4 markets.