Electric Vs Petrol: Ather Launches New Family E-scooter ‘Rizta’, CEO Tarun Mehta Says Continuation Of Subsides Vital

Tarun Mehta, the CEO and co-founder of Ather Energy, a prominent e-scooter maker in India, has emphasized the importance of government subsidies to facilitate the transition from traditional motorbikes to electric scooters. In an interview with Reuters, Mehta underscored the necessity of sustained financial incentives to accelerate the adoption of electric vehicles (EVs) in the country.

Subsidy Reliance and Impact:

Mehta acknowledged that while Ather Energy has made strides in reducing its reliance on subsidies, the abrupt reduction in government incentives in May 2023 has affected the company’s growth trajectory. The decision to slash cash incentives for e-scooters from 40% to a maximum of 15% of the purchase price has posed challenges for the industry. Industry experts echo Mehta’s sentiment, emphasizing the pivotal role of subsidies in achieving India’s ambitious goal of electrifying 70% of its two-wheeler fleet by 2030. As India, the world’s third-largest importer of oil, seeks to diminish its dependence on fossil fuels, government support becomes indispensable in driving the shift towards sustainable transportation solutions.

Ather’s Strategy and Challenges:

Ather Energy, known for its innovative 450 series of e-scooters launched in 2018, faces stiff competition from larger rivals such as Ola Electric and TVS Motor, which have leveraged aggressive discounts to drive sales. To stay competitive, Ather recently introduced a new e-scooter named ‘Rizta,’ priced at 109,999 rupees ($1,321). Mehta aims to broaden Ather’s market reach by targeting buyers in India’s populous north and west regions with features like a larger seat and enhanced storage space. Despite focusing on expanding its top-line growth, Ather has yet to achieve profitability. However, Mehta remains optimistic about the company’s prospects, citing promising margins at a unit level.

Government Support Crucial for Growth:

The Indian e-scooter market, though nascent, is witnessing steady growth, accounting for 5% of total two-wheeler sales in fiscal 2023-2024. Mehta’s advocacy for continued government backing underscores the imperative of sustained policy interventions to incentivize the adoption of EVs and foster a conducive environment for their proliferation in the Indian market.

In conclusion, Tarun Mehta’s remarks highlight the pivotal role of subsidies in driving the transition towards electric mobility in India. As the country grapples with environmental concerns and seeks to reduce its carbon footprint, sustained government support emerges as a linchpin for realizing its electrification goals in the transportation sector.