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Riding the rough (Indian) EV road – Part 2

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Category: Interviews

Published on Friday, 18 March 2011 10:47

Written by Tejas Joseph

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An industry leader talks about the future of electric cycles and scooters in India

( Continuing the second  and concluding part of our interview with K.B Srinivasan,Vice President – R&D and Quality of TI Cycles & BSA Motors)

Evfuture : Tell us now about BSA's plans to be a part of this emerging and bright EV sector

Srinivasan: In a sense the wheel has come full circle for us. We started out with bicycles, kept making them through the period when motorcycles replaced them in the public imagination, and now return to them with a new vision and understanding of their continuing significance and role in mass mobility for India.

The cycle is king

BSA have always viewed themselves as a commuting company, not just a maker of bicycles. In the years following the motorcycle boom (when the cycle lost its supremacy as the reigning mobility device in the two-wheeler class) we continued to think of new ways to bring the cycle to people. A growing fitness conscious Indian middle class offered us the opportunity to think of exclusive sports cycles,sporting goods and fitness equipment showrooms in 2005. Our Track & Trail shops in upmarket Indian metros stock and sell premium cycle brands and accessories from the world's leading bicycle manufacturers. Its success assured us that the humble cycle had the capacity to change with times and will always be king.

We kept on improving our fleet of bicycles and continued to meet market demands with quality, innovation, value for money and reliable after sales support.

Emerging mobility trends worldwide

Throughout the first years of the new millennium we were studying global trends in the field of alternative two wheeler mobility. We saw the headway that China was making with electric vehicles and, in particular, electric bikes and scooters. In 2007 we sensed the coming of a new mobility era and decided to seriously study the EV market that was beginning to rear its head in India. We thought of expanding from our core product (cycles) to electric scooters,which we felt had a latent market demand that could be awakened with a good product and dependable post-sale maintenance support.

Taking the electric step

We took the bold step in 2008 and introduced two versions of our electric scooter – the low and high speed models. Though the vehicles are good, reception was rather slow to begin with. The first Indian 'EV fiasco' was still alive in public memory and people were cautious in trying out electric scooters again. What really made the difference for us ( just as we had hoped) was the reputation behind our brand name. Having been in the cycle business for more than a half century helped us create an all India dealer network that is solid and reputed. We intend to build a similar one for our electric scooters and cycles.

Taking it slowly : Electric scooters for south India first

We started small with our electric scooters concentrating only on the four southern states of AP, Kerala, Karnataka and TN to begin with. We wanted to create a favorable market climate for our electric scooters by hand holding a first generation of buyers with good products, valuable product education and dependable after sale service support.

Evfuture: How has it been going? Do you see a turning of the tide in public opinion for electric two wheelers?

Srinivasan: There is a shift in customer attitude towards electric vehicles in general. This past year (2010) saw 3 hikes in the price of petrol. While these jumps are marginal (and may not pose a threat to the higher income groups) they have served to bring about a 'fuel savings' syndrome in the minds of many people. To this can be added a growing green consciousness amongst an educated section of the public. It is quite clear that our cities are amongst the most polluted and congested in the world. While electric vehicles may not decrease congestion, at least they will justify their existence by ameliorating pollution through zero emissions.

Evfuture: What forecasts do you make for your electric scooters now that they are out?

Srinivasan: Sales are sluggish and we don't get to meet our targets. It is by all accounts an infant market that will need time to mature. While it is difficult to posit exact time lines,we hope to see a turn around happening in about 2-3 years given that world economic and political conditions remain fairly stable. We see these intervening years as a preparation for an eventual ev mass acceptance. We will use this time in perfecting our products,understanding customer needs and building a reliable ev spares and service infrastructure.

Evfuture: Which of your two electric scooter models are selling better, and why?

Srinivasan:

The tortoise and the hare story, again!

The low speed (250W-25Kms) is our winner. Priced at Rs.17,500/ it accounts for almost 95% of our sales. Grown school going boys and girls,working women and house wives, self employed people and senior citizens make up the profile of this market for us. Slow speed,short distance requirements,license and registration free use and easy/quick charging are the appealing aspects of this model.

The high speed (500-800W-50Kms) is slower to sell for a variety of reasons. Firstly, it is expensive (retailing at almost Rs.40,000) and has a top speed of 60Km. This creates an unconscious blurring in the minds of users who expect that it should perform like a conventional IC scooter of the same value. They feel disappointed by its limitations -power ,speed and range - and tend to overlook its advantages as an EV – no pollution,savings on fuel and easy intra - city handling.

Evfuture: What about costs of EV ownership. In the end, is it really cheap to own an EV despite some of its more obvious plus points ?

Srinivasan: At the present moment, No! Periodic battery replacements eventually cancel out the gains of fuel savings. Advance battery technology with longer storage life holds the key to the eventual success and popularity of EVs.

Evfuture: Tell us about the trials of electric scooter manufacturing in India

Srinivasan: China constitutes the bulk of our supply chain currently. The Indian government's recent decision to withdraw customs duty on imports, is to encourage and stimulate technological self reliance in the ev home industry. It is now conditional to have a 30% indigenous parts constituent in our scooters. Our objective is to increase this self reliance by aiming for higher indigenous component constituents in our products progressively. We are identifying and nurturing Indian component suppliers who can be depended upon in the coming years to supply every major part/ancillary of an electric scooter. Some day (and not very far off) we would like to seen as a maker of world class electric scooters that are 100% Indian.

Evfuture: Can you name your 'secret weapon' in the Indian EV revolution to come?

Srinivasan: As said in the beginning, we are back to our basics. Encouraged by the continuing relevance of the cycle as a simple commuting device with the added benefits of exercise made us think of adding one more value chip to it – an electric motor. We have reasons to believe that a lot of people (particularly the elderly) will take to an electric cycle instead of a conventional one as it is easier to ride. Young people not old enough for a motorbike and fond of cycling and some speed will also welcome it. The electric cycle has considerable potential for rural India as well if a supporting infrastructure can be set up. The electric cycle has the potential to revolutionize the mass transit market in our opinion. What is needed is a combination of quality,price,service and affordable replacements.

Evfuture: What are the models and prices of these electric cycles and when do you intend to launch them?

Srinivasan : We plan two models initially, one for kids and another for ladies. They will be priced within Rs10,000. We are also considering a high end version for later, which will have long range, longer lasting Lithium Ion(LIon) batteries. Launch is planned for later in 2011. We intend to promote these with road shows and other campaigns carrying the sub text of a cleaner environment and personal fitness.

Evfuture: What would you say in concluding?

Srinivasan: EVs will make a rather slow entry, both onto Indian roads and public awareness. But the tide is turning towards electric mobility and we can hope to see their numbers increase exponentially with prices coming down, quality getting better and ownership costs decreasing in the years ahead. EV success and acceptance will eventually have to be defined by proven reliability and savings, not just by hype and green goodwill.

This interview has been concluded. We hope to bring you more such views from people and news about the companies that are defining EV mobility trends and technologies in the country today.

Riding The Rough EV Road – Part 1

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Category: Interviews

Published on Tuesday, 08 March 2011 10:23

Written by Tejas Joseph

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An industry leader talks about the future of electric cycles and scooters in India

BSA is India's first and oldest maker of bicycles. Started in 1949 the company's primary aim then ( as it is now) was to make basic pedal powered mobility good, reliable and affordable for every Indian. It was a brand name that became pervasive with its monolithic market presence through the post independence years up until the 80s. If you could talk to a farmer, a factory worker, a school teacher or a middle order government employee from the 1960s and 70s about their first two wheeler purchase, the chances are pretty high that it would have been a BSA!. Preteen boys from suburban middle class families almost invariably got a BSA sports cycle as a birthday gift. It signified a rite of passage as much as social standing

Today, at the beginning of the second decade of the second millennium, the company has kept unswervingly to 'two wheels' as its core business,but added to its scope and value in keeping with changing times and circumstances. Electric scooters and cycles is the next curve on the road to innovative commuting for BSA.

A day at BSA

EV Future had the distinct pleasure and privilege of spending a morning with K.B Srinivasan,Vice President – R&D and Quality of TI Cycles & BSA Motors. He shared with us his deep knowledge of and passion for the industry and gave us a preview of their next generation of electric scooters and electric cycles.

Evfuture : BSA was a market leader in its category from the start. At what point did bicycles give way to motorised mobility?

Srinivasan: The explosion of motorized two wheelers – bikes and scooters - upon Indian roads began in the mid 80s. It signaled the first shift in customer preference that was, until then, focused upon the bicycle to a large extent as the most accessible and affordable medium of personal mobility available to the common man. Continuing into the 90s, and beyond into the new millennium, two wheeler IC technology kept getting better - with more choice, features, speed, fuel efficiency and price tags to suit a wide variety of customers. By the end of the 90s motorbikes and scooters had become almost as ubiquitous as cycles, even though the latter still formed the largest group by numbers, being used by almost 65% of the country's population even now.

Evfuture : When did EVs begin to emerge upon the Indian two wheeler landscape?

Srinivasan: The period from 2000 saw a swing in an unexpected direction. Depleting oil reserves complemented by steadily rising fuel prices and the specter of climate change began to force the mobility sector worldwide to develop alternatives to fossil fuel based power for mobility. The EV buzz began.

2007 saw the arrival of the first Indian EV wave comprising cheap electric bikes,scooters and cycles imported from China. They came in container loads and got fanned out by traders all over the country. They sold well as they appealed to a lot of people with their low price tags and novelty value.

Evfuture : Can this be cited as the dawning of the EV age in India?

Srinivasan : Hardly! It may have served to introduce the average Indian to an idea of mobility distinct from the conventional one. However, a very poor comprehension of the Indian EV market and the education needed for its consumers killed a great idea in its infancy. This first generation of light EVs (electric bikes, scooters and cycles) were perceived more as toys and less as serious alternatives to conventional mobility.

Evfuture : What went wrong?

Srinivasan : Within a year, (i.e by 2008), the EV bike and scooter bubble burst. The main reason for this was the lack of post sale service infrastructure that this group of pioneer distributors failed to set up. They could not anticipate that the success of the ev market lay in this one aspect alone - not in new models and lower prices as they wrongly thought. This one factor (poor or virtually nonexistent after sales support) by itself can be cited for taking away the credibility of electric bikes,scooters and cycles in India. So onerous was it that it made it hard for the established Indian bike and cycle makers (BSA,Hero,TVS and others) to enter the ev segment. It forced us to realise the tremendous importance of both education and a supporting service infrastructure if electric vehicles were to be taken seriously in India.

Evfuture : Can you list the factors that can make a difference to ev acceptance in India?

Srinivasan: I would start by putting the need for official support first on my list. Let me tell you the tale of two countries (India and China) united by the bicycle (in that they both have big bicycling populations with an active bicycling culture) but divided by visions for it.

China's EV head start

China took a lead ( a twenty year head start in technological terms) in the EV sector that was enabled only due to a fortuitous combination of Government support and entrepreneurial initiative. More than a third of China's EV two wheeler production is sold within the country.The Chinese are an avid bicycling people,which makes the bicycle a cheap and readily accessible form of transport for millions, like India.

The motorbike VS the eCycle : an administrative ploy that worked

The Chinese preference for numbers over quality has brought into being a scenario where around 900 odd local makers of IC motorcycles sell cheap but inefficient motorbikes and scooters ensuring high running and maintenance costs for its Chinese end users. Additional barriers that serve to restrict motorcycle growth and popularity in China (and tip the balance in favor of EVs) include very high licensing and registration fees and road taxes on new motorbikes and scooters. Coupled to this is the very low resale value on used vehicles ensuring that most of them end up on the scrap heap.

All this because China saw the bicycle as a means to combat pollution,urban congestion and rising oil imports, and as a form of mass mobility that still had relevance to a rapidly developing nation.

India's pro motorcycle mindset delaying EV entry

The example of the motorcycle market in China is the exact opposite of India's, where relatively low road and user taxes coupled with very efficient,technologically advanced and user friendly vehicles (considered by many to be the most efficient two wheeler fleet in the world) with reasonably good resale value ensures that the motorcycle market remains continually strong and healthy with good growth prospects for years to come.

But, unlike China, India has not taken any proactive measures to generate an agreeable environment for electrically assisted two wheelers yet. China's low EV taxing policy and subsidies along with incentives to EV makers and facilities for EV users - like public charging stations and free parking in city centers and premium spots - is encouraging a climate favorable to non polluting electric vehicles there.

Evfuture : Is the Indian government coming closer to accepting and encouraging electric mobility forms now more than before?

Srinivasan: Yes! While the going was tough these past years we ( who are in the industry and know the situation best) do see clear signs of change emerge. The SMEV (Society of Small Electric Vehicle Manufacturers) is a proactive lobby that consists of all the primary and major makers of EVs, EV parts and ancillaries in India. The SMEV have taken it upon themselves to inform the government of crucial developments and opportunities in the emerging EV sector. Their continued advice and industry prognoses have helped in many ways with the framing of a national EV policy,which will be formally announced later in 2011.

Evfture : Can you give us an overview of this proposed national EV policy?

Srinivasan: While the details are still not clear we think that the proposed national EV policy will tilt towards subsidies and incentives to EV makers and users, cuts in import duties for EV parts and components, VAT waivers for EVs in all Indian states and other supports that can positively impact this new mobility segment. This is a move that augurs well for the EV industry and market in general. Its coming can certainly pave the way for the eventual entry and acceptance of a variety of electric based forms of mobility.

EVfuture : Will the national EV policy also include in its embrace quality monitoring and certification of products and parts that will be needed if the EV sector is to build and retain credibility in its first years?

Srinivasan: Its a good question and we would like to think that the national ev policy will catalyse the formation of watchdog bodies and regulators who can oversee the dispensation of subsidies and create viable norms for product quality. We are also hoping that it will serve to stimulate thinking about the vital need for public ev infrastructure (like charging stations) that is an indispensable part of the EV eco system. A convergence of quality products, good incentives and reliable infrastructure is what will be required to establish this nascent sector. One hopes that the national policy has the vision and teeth to bring this about eventually if not right away.  (end of Part 1. To be continued in a future post)