Two-wheeler mobility startups take EV route to lower operational costs3 min read . Updated: 16 Nov 2020, 04:40 PM IST
- Mobility startups such as Bounce, Vogo and Rapido, among others, are actively looking to include a bigger component of EVs in their respective fleets.
Bengaluru: Cheaper maintenance, lower operational and life-time costs along with installation of key infrastructure like battery-swapping stations have prompted two-wheeler shared rental startups to increasingly transition to electric vehicles (EV).
Mobility startups such as Bounce, Vogo and Rapido among others are actively pursuing to include a bigger component of EVs in their respective fleets.
Bengaluru-based scooter rental startup Vogo aims to have EVs comprise nearly 70% of its total fleet size over the next five years, while Bounce has already raised capital to invest into making its fleet green. Rapido, the two-wheeler taxi startup, has set no target but is also looking to bring down its carbon footprint.
“For us, EVs make sense purely because of the math," Anand Ayyadurai, founder and CEO, Vogo said.
Cost of electricity is less than one quarter that of petrol that brings down per/km expenditure.
The Centre’s policy that allows EV makers to sell the vehicle and the battery separately has brought down upfront cost for startups.
“The battery then becomes a variable cost for us that can be paid over a period of time rather than upfront," Ayyadurai added.
The EV segment in India accounts for less than 1% of the total vehicle sales and experts said that this has not helped bring down the cost of batteries, which account for almost 50% of the total cost of a vehicle.
More than 90% of all EVs in the country are low-speed electric scooters but several large two-wheeler makers like Hero as well as startups like Ather Energy are ramping up production of green vehicles.
Induction of more EVs is expected to help bring down piling operational costs for mobility startups in urban centres, which were hit hard due to the ongoing pandemic and reduced need for mobility services.
However, since the lifting of the restrictions, fear of contracting the virus while travelling in buses, metro and other crowded modes of transport is bringing back some of the demand for shared two-wheelers.
Vivekananda Hallekere, CEO and co-founder, Bounce, said that EVs reduce the risk of petrol pilferage, it's easier to set up charging infrastructure and there is the added benefit of going green.
Bounce, one of India’s biggest mobility startups, raised $6.5 million from InnoVen Capital earlier this year which will be used to fund its EV fleet among other objectives.
But not all state governments have extended subsidies for EV makers or buyers. The low battery life and high cost of the EV itself remain as challenges for the growth of the segment in India.
“For every 10 degrees, your battery life comes down by half," said Chetan Maini, co-founder and vice-chairman of Sun Mobility, a company that has set up battery-swapping stations across several cities.
Maini, the inventor of India’s first electric car Reva in 1999, said that swapping brings down "range anxiety", a term used to describe the fear of EV drivers of running out of charge and reduces the risk of ownership of battery.
This "flexibility of range" helps increase utilization, he added.
“Imagine a company like Bounce or Vogo charging their vehicles for 4-5 hours in the middle of the day...it just doesn’t work and becomes very difficult," Maini said, adding that swapping stations are just like fuel stops wherein a battery is fitted into a vehicle in less than a couple of minutes that gives them a full charge to travel.
“EV is a long-term good and the cost of doing business will come down but this is still some time away before it gains critical mass," Vinod Murali, managing partner, Alteria Capital said.
Ecommerce companies such as Flipkart and Amazon among others have started using EVs (two, three wheelers and other non-passenger vehicles) for deliveries. Several state governments and capital city Delhi have also brought in policies to induct more e-auto rickshaws and e-buses to bring down rising pollution levels.