Tarun Mehta Emphasizes the Importance of Government Support for India's Transition to Electric Mobility
It is believed by Tarun Mehta, the CEO and co-founder of Ather Energy, that subsidies for electric scooters will need to be continued by India for a few more years in order to boost the transition from polluting motorbikes. In an interview with Reuters, it was stated by Mehta that “A lot of subsidy reliance has been cut down, but it’s also come at the cost of almost a year’s worth of lost growth.” He was referring to the government’s surprise decision in May 2023 to slash cash incentives for e-scooters to a maximum of 15% of the purchase price before tax from 40% previously.
It is considered crucial by industry experts for India to achieve its goal of electrifying 70% of its two-wheeler fleet by 2030 that subsidies, such as cash incentives, be continued, as the world’s third-largest importer of oil looks to reduce dependence on fossil fuels.
The pickup in adoption was driven by Ather with the launch of its 450 series of e-scooters in 2018, but the company has fallen behind larger rivals Ola Electric and TVS Motor, whose discounts have driven sales.
A new “family-friendly” e-scooter called ‘Rizta’ was launched by Ather on Saturday, priced at 109,999 rupees ($1,321), with hopes that the scooter’s larger seat and storage space will attract a wider range of buyers in India’s populous north and west regions, helping boost sales.
While top-line growth is being focused on by Ather, it is acknowledged by Mehta that the company has not yet broken even. It was stated by him, “Hopefully, a meaningful role will be played by the Rizta because I am happy with how margins are shaping up at a unit level,” without providing further details.
The Indian e-scooter market is small but growing, accounting for 5% of total two-wheeler sales in fiscal 2023-2024. The comments by the CEO of Ather underline the need for continued government support to drive the adoption of electric vehicles in the country.
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