From cabs to electric two-wheelers, Ola has dominated every market they’ve entered. But can they handle the big leagues of car manufacturing?
Ola Electric Mobility, the number one player in the electric two-wheeler market, is aiming to disrupt the Internal Combustion Engine (ICE) segment with its ambitious plan to create six different electric cars with various body styles and price points using three distinct platforms.
An anonymous insider with knowledge of Ola Electric Mobility’s plans has revealed that the company is preparing to launch its first electric car in May 2024, with subsequent models released every six to nine months. These cars will come in various body styles, including hatchbacks, sedans, compact and midsize SUVs and sports cars. The source also stated that the cheapest model could be priced under Rs 10 lakh, while the most expensive may exceed Rs 30 lakh.
2024 slated as the year for Ola Electric Mobility’s first electric car launch
In an announcement, Ola Electric Mobility’s founder Bhavish Aggarwal revealed that the company’s first electric car will be a premium model, scheduled for release in 2024. Sources indicate that five more models will debut over the next three years. Aggarwal has stated that the first car will offer a range exceeding 500 km on a single charge.
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Ola Electric is planning to follow its successful two-wheeler market strategy in the four-wheeler space by offering a wide range of EVs at competitive prices, according to an anonymous source. The company intends to localise production, including battery cells, to keep prices similar to those of traditional ICE models. Additionally, the SoftBank group-backed firm has signed an MoU with the state government to establish an EV hub, which will include advanced cell and EV manufacturing facilities, vendor and supplier parks, and an ancillary ecosystem for EVs at one single location.
Inspired by Tesla’s D2C strategy, Ola plans to retail its upcoming e-cars in a similar manner, allowing customers to book directly through the company’s website/app. However, as with its E2W strategy, the company will establish experience centres in the top 10 cities during the first phase. In CY 2022, e-cars accounted for just 1.2 per cent of total passenger vehicle sales, with 41675 units sold (up from 0.5 per cent penetration in 2021). Tata Motors was the largest e-PV player, selling 34833 electric cars, followed by MG (3891), Hyundai (740), BYD (553) and M&M (280), according to Vahan data. A new report from P&S Intelligence suggests that the electric car market in India is expected to grow at a remarkable rate of 33.3% over the next eight years, resulting in an estimated 376000 units by 2030.
As many may recall, Ola Electric was established as a wholly-owned subsidiary of ANI Technologies in 2017. However, in December 2018 and January 2019, Aggarwal acquired a 92.5% stake in Ola Electric from ANI Technologies for Rs. 1 lakh. Later, Ola Electric was spun off as a separate entity, with ANI Technologies still retaining a 7.5% stake to allow for the use of the Ola brand name. The company’s first e-scooter, the Ola S1, was launched in May 2020. Despite being separated from ANI Technologies as an independent entity, Ola Electric was allowed to use the Ola brand name, with ANI Technologies retaining a 7.5% stake in the company. In May 2020, Ola Electric unveiled its inaugural electric scooter, the Ola S1, as it entered the electric vehicle industry.
February 2019 saw Ola Electric raise $56 million in funding from Tiger Global and Matrix India. A few months later, after receiving an undisclosed investment from Ratan Tata in May 2019 as part of its series A funding, Ola Electric secured $250 million from SoftBank in July 2019 during its series B funding, with a valuation exceeding $1 billion.
With its disruptive impact on the cab and E2W spaces, Ola has already proven that it is a force to be reckoned with. However, the car industry is an entirely different beast, and according to Gaurav Vangaal, Associate Director, S&P Global Mobility, Ola will need to make a strategic decision about how to proceed. Whether Ola chooses to build a car platform from scratch or acquire an existing one, it will be facing a steep uphill battle against a crowded and highly competitive field. According to him, the EV market could face disruption from premium vehicles, but predicting their prices and range is currently a challenge.
