Ola’s arch rival Ather Energy to set up second factory, expands overall capacity to 400,000 units, Auto News, ET Auto

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 Ather has been registering 20% growth on sales month-on-month over the past year and recorded its best ever sales in October 2021.
Ather has been registering 20% growth on sales month-on-month over the past year and recorded its best ever sales in October 2021.

Flush with the success of its 450X and 450 Plus scooters, Hero MotoCorp’s Pawan Munjal backed startup Ather Energy on Monday said it is investing in a second manufacturing facility in the country which will take its overall capacity from 120,000 to 400,000 units.

The announcement comes in the backdrop of Bhavish Aggarwal owned Ola Electric’s much hyped albeit delayed entry into the fast growing electric two wheeler market in India. Ola has plans to set up a much larger 10 million unit per annum facility but is struggling to ramp up and is running behind schedule.

On the other hand, incumbents including Ather have registered impressive growth in the last few months as high cost of petrol and multiple incentives from central and state governments have acted as strong tailwinds for electric mobility. Ather has been registering 20% growth on sales month-on-month over the past year and recorded its best ever sales in October 2021. It crossed $100 million revenue run rate during the month.

“The EV demand has been shooting up across the country, and customers are coming in expecting electric scooters to wow them. This customer expectation is why our 450 series of electric scooters – the 450X and 450 Plus is seeing massive demand as it is the best electric scooter in the country today,” said Tarun Mehta, Co-Founder & CEO, Ather Energy. “Our experience centres are scaling up rapidly, and our retail footprint is set to grow by six times in the coming quarters. So, within just ten months of opening our current facility, we find ourselves already operating at full capacity. We are commissioning the second plant to be ready for 2022. With this capacity expansion, Ather is well on its way to becoming the country’s largest EV producer by next year.”

Ather has reaped the benefit of being ready to capitalise on the demand, something that Ola seems to be missing out on.
Ather has reaped the benefit of being ready to capitalise on the demand, something that Ola seems to be missing out on.

The company’s second factory will also come up in the same location–Hosur, as its first which went on stream earlier this year. With this, its cumulative production facility will go up to 400,000 units per annum. In fiscal 2021, around 150,000 electric two wheelers were sold in the country. Estimates suggest the number will double this fiscal.

Ather has reaped the benefit of being ready to capitalise on the demand, something that Ola seems to be missing out on. In October, Ather registered its best-ever monthly sales numbers, registering 12-fold growth over last year. It has recorded a 3X increase in walk-ins, web inquiries and test rides from April-October 2021 and a 4X growth in vehicle booking in the period. In value terms, Ather claims it is already the largest EV maker in its segment. It is something that Ola will surely want to test once its issues are sorted and the S1 and S1 Pros start reaching their customers.

Apart from the EV manufacturing, the Hosur facility will also focus on lithium-ion battery manufacturing. It has plans to strengthen its retail operations as well by expanding to new markets–around 150 Experience Centers in 100 cities by March 2023.

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“Global automotive industry is in a transition phase and shifting towards electric mobility and in India, this transition has started to pick up pace. Darwin EVAT aims to contribute more to this electric revolution,” DPGC Group CEO Raja Roy Choudhury said in a statement.

“This investment will be utilized to increase manufacturing capacity, accelerate new product development, and expand experience centres, to bolster the company’s expansion plans,” the company said.