Indian EV Scooter Startups Face Losses And Rivalry

- Advertisement -

Indian electric scooter startups face mounting challenges, with significant losses and uncertain regulations causing hesitation among investors. Despite their substantial market shares, competition intensifies as traditional automakers increase their presence in the electric vehicle (EV) sector.

Ather Energy, a leading sales startup, experienced difficulties raising funds. While seeking a valuation of over $1 billion, potential investors hesitated, leading the company to opt for a rights issue. In September, they announced a $108 million fundraising via shares issued to existing investors, Hero MotoCorp and GIC. According to Tracxn, Ather’s previous valuation was $732 million. Their sales have increased, selling 72,436 vehicles until August this year, surpassing the total sales of 2022.

Ola Electric, backed by SoftBank, saw a slight increase in valuation to $5.5 billion following a $140 million funding round in September. After launching its first scooter, Ola’s valuation reached $3 billion in September 2021, which rose to $5 billion by January 2022. The company has now established itself as India’s top electric two-wheeler producer, claiming about a third of the market.

- Advertisement -

However, the moderate enthusiasm for Ola and Ather’s fundraising rounds is considered concerning, especially given India’s growing focus on eco-friendly mobility. An investor in Ather emphasized the need for startups to enhance gross margins and seek profitability. While they may manage with limited fundraising, long-term growth demands more substantial rounds.

Financially, Ather reported a significant increase in revenue for the fiscal year ending March 2023, but losses also increased. Ola Electric’s latest financial data remains undisclosed, but in fiscal 2022, their revenue was $45 million with losses of $94 million.

These startups also face external pressures. The government recently reduced subsidies that previously made electric two-wheelers more affordable. In response, companies raised their prices or introduced models with smaller batteries. Consequently, electric two-wheeler registrations experienced a decline.

For startups, the challenges are multifaceted: increasing sales and mitigating losses to lure investors. Unlike traditional companies, Harshvardhan Sharma of Nomura Research Institute emphasized that startups lack the luxury of cross-subsidizing their EV ventures.

Major Indian automakers, including Hero MotoCorp, Bajaj Auto, and TVS Motors, are accelerating their EV strategies. But these traditional players face their challenges. While startups have room to grow, legacy manufacturers grapple with the dilemma of transitioning from their conventional vehicles to EVs, balancing profitability concerns with evolving market demands.

- Advertisement -

Most Popular Articles

Aryaman Raghuvanshi
Aryaman Raghuvanshi
Aryaman Raghuvanshi is a Journalist at EFY. His passion is to explore the future of mobility, which gets him to cover latest technologies shaping the future of automobiles and EVs. But, at times he writes on broader technologies too. LinkedIn: https://www.linkedin.com/in/aryaman-raghuvanshi-2431b7153
Optical Fibre Connecticity-Ladakh

Indian Army Installs Optical Fiber Connectivity In Siachen And Daulat Beg Oldi 

0
Ongoing infrastructure projects, such as the new road to Daulat Beg Oldie (DBO), are set to significantly improve logistical support for troops deployed in...

Lumax Auto Buys 60% Of Greenfuel Energy For Rs 153.09 Cr

0
This collaboration with Greenfuel enables LATL to expand and diversify its range of solutions for automotive OEMs in India. Lumax Auto Technologies has completed the...

River Launches Updated Indie Electric Scooter With Chain Drive And New Colors

0
The revamped Indie now comes with a single-speed gearbox and a chain drive, enhancing both durability and cost-effectiveness. It is also available in two...

Ola Unveils S1 Z Electric Scooter Priced At Rs 59,999

0
The S1 Z operates with two detachable 1.5kWh battery packs and features 14-inch wheels. Ola Electric has recently expanded its lineup of electric scooters by...

Mahindra Unveils Electric BE 6e And XEV 9e Models

0
Deliveries are scheduled to start in late February or early March 2025, following a phased market introduction that begins in January 2025. Both models...
S.K. Yadav of RIGOL Technologies

“Our India Business Is $2 Million, With A Goal To Reach $6 Million” –...

0
In a chat with EFY’s Nitisha, S.K. Yadav of RIGOL Technologies highlights the company’s journey in India, shedding light on its growth prospects and...
Bejoy George, Managing Director- Chipmax Designs Private Limited,

“We Are Advancing R&D Projects To Develop Modular Assembly Lines With Adaptive Robotics” –...

0
How do you envision technological progressions influencing the future of manufacturing operations? Get informed from Electronics for You’s Akanksha while in dialogue with Bejoy...
Srinivas Parikshith, Co-founder of Auckam Technologies

“We Anticipate Turnover Reaching 40 Million Rupees Next Year With The New Product Line”...

0
Discussing the electronics manufacturing sector, Srinivas Parikshith, Co-founder of Auckam Technologies, talked to EFY’s Nitisha Dubey about their expansion plans to set up a...

“We Bring Intelligence Early On Into The Design Cycle” – Michel Van Cotthem VP...

0
With a solution embedding intelligence early in the design-to-source lifecycle, Supplyframe aims to leverage India’s electronics manufacturing boom. At IEW 2024, Michel Van Cotthem...
Vijai Karthick Selvam, Director of Teqtis

“We Do Everything From The Initial Concept To The Final Box Build” – Vijai...

0
Why are testing and R&D essential to combat printed circuit board manufacturing challenges? Speaking to EFY's Nitisha Dubey, Vijai Karthick Selvam, Director of Teqtis,...

HKTDC Electronics Fair Sparks Innovation, 60,000+ Participants!

0
Showcasing cutting-edge tech, global innovation, and booming markets for the future of electronics, HKTDC’s Hong Kong Electronics Fair and electronicAsia drew 60,000+ professionals. Last month,...
Applied Materials Representational Image

Applied Materials Selects Six Startups For Deep-Tech Accelerator Programme

0
The selected deep-tech startups will be evaluated for investment by Applied Ventures and potential collaboration opportunities with Applied Materials. In collaboration with the company's India...

Space tech Startup Akash Secures $68M CHIPS Funding

0
Eyeing to power into AI, EVs, and more high-tech industries, Akash Systems lands $68 million CHIPS grant to boost its cooling tech facility, generating...

Wireless Light-Based Communication With Velmenni’s Technology

0
Velmenni is at the forefront of wireless communication innovation with its pioneering light-based technologies, Li-Fi and LC Link. Founded by Deepak Solanki in October 2014...

Harnessing AI Technology For Efficient Pest Management

0
AI-Genix, an agri-tech startup, is transforming pest management for farmers through advanced AI-enabled systems that precisely target harmful pests. In an industry where pesticides and...

Industry's Buzz

Learn From Leaders

Startups