Ather Energy, a leading electric scooter manufacturer, has announced plans to accelerate the launch of new models in the domestic market and explore export opportunities, according to the company’s CEO in an interview with Reuters. This decision comes after the Indian government reduced subsidies for electric vehicles, impacting the industry’s growth. Currently, electric scooter models account for only 5% of total scooter and motorcycle sales in India, falling short of the government’s target of 70% market share by 2030.
Unexpectedly, the government slashed cash incentives for electric vehicles in May, without providing a reason. As a result, total e-scooter sales dropped by over 50% in the following month.
Ather Energy also experienced a decline in sales, but it is now witnessing a rapid recovery. CEO Tarun Mehta revealed that the company is working on two new models, with one of them set to be launched six months ahead of schedule.
Regarding the impact of subsidy changes, Mehta stated, “The transition to electric vehicles could have been faster if not for the (subsidy) change but even then, there will be no major impact in the mid to long term.” He emphasized the need to speed up product launches and increase investment in product development.
As part of its long-term growth strategy, Ather aims to generate over 50% of its sales from global markets by the end of the decade, Mehta revealed. Currently, Ather is the third-largest e-scooter maker in India, trailing behind Ola Electric and TVS Motor.
Valued at around $750 million, Ather plans to raise additional funds before the end of 2023 to support its growth plans. However, the CEO did not provide specific details about the fundraising. According to an insider, the company is looking to secure a similar amount to the $108 million raised in a recent rights issue involving existing shareholders Hero MotoCorp and GIC.
Furthermore, Ather will soon pilot e-scooter sales in an Asian export market, as Mehta believes that not only will India become the largest market for electric two-wheelers, but also the largest exporter.