Chennai, May 13 It is great to bike around for just 10 paise per km, but then, in this world, nothing comes without a downside.
Battery powered scooters are in�Hero, TVS, Ultra Motors have all launched their products and there are other wannabes too. The products appear great for short distance, low speed commuting, but with at least one headache�you may have to replace the battery once a year.
The cost of the battery is inexorably dependent upon the international prices of lead. Last year, a battery for a low-speed electric scooter cost around Rs 3,000. Now, it is Rs 7,000.
The Indian market for these products is at its infancy. Last year, in India 7.2 million two-wheelers were sold, but only 100,000 of them were electric scooters. The cost of the battery is then an issue to reckon with for the manufacturers.
Hero Electric is doing something about it, says the company�s Managing Director, Mr Naveen Munjal.
At a press conference here today, he spoke of Hero Electric �subsidising� the batteries, but only said it was working on the mechanism for it. He said that getting batteries recycled was one option. Getting the government abolish the customs duty (10 per cent basic plus CVD) would help get the prices down further. When volumes increase, Hero would be able to source batteries cheaper.
�It is not a major issue,� Mr Munjal said, comparing life time ownership costs of an electric scooter and a regular scooter.
Hero Electric (today a division of Hero Exports, but to be hived off into a separate company soon) sold 21,000 vehicles last year for about Rs 60 crore. This year, it targets to sell 70,000.
At present, Hero produces the chassis and most of the mechanicals and it buys a few other items such as lamps and tyres locally. Only the electricals�comprising motor, controller, battery and charger�are imported.
Over time, the company would invest in the manufacture of all the electricals, except the batteries. Hero is in talks with all the major Indian automotive battery manufacturers to get the products made in India. The battery companies are interested, but again, the issue is one of volumes.
Products launched
Today, Hero Electric launched its products, Maxi and Optima, in Chennai. Both are low speed vehicles�they do not need registration or suffer road tax (as opposed to high speed vehicles, which do).
They can run a maximum of 25 km an hour. The battery takes six hours to charge and can drive the vehicle for 70 km. The battery will last some 300 charges. The vehicles are priced around Rs 30,000.
Mr Munjal said that Hero Electric would look at setting up a manufacturing facility in the South next year.
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