By Sharad Matade
Lohia Auto Industries which has electric vehicles with 25KM/hr speed is developing vehicles up to 45Km/hr. The product offerings of Lohia Auto Industries include electric two-wheelers, three-wheeler passenger and cargo electric rickshaws and multi-option passenger and cargo three-wheelers.
“Going forward, our focus will be more on electric vehicles in the next three to four years, but we are not leaving any opportunity untapped in the gasoline vehicle segment. According to our plans and market trends, we will concentrate on either segment as both the electric and the gasoline segments are important for the company’s growth,” Ayush Lohia, Chief Executive Officer, said.
Started as an electric vehicle manufacturer around a decade ago, Lohia Auto also forayed into the gasoline three-wheeler rickshaw business in 2012-2013. It was a strategic decision of the company to expand its product portfolio to the gasoline three-wheelers to support the subdued demand for electric vehicles. “When we started operations in 2009, the government policies were not very supportive. Coupled with this, awareness and penetrations of electric vehicles in the Indian market were very low. However, we were way ahead of time anticipating the opportunities in the electric vehicles segment. We were having two options, how to take the electric vehicles business ahead amid several challenges or expand the product portfolio to gasoline vehicles and have some stability in the business and then pursue EV business aggressively,” he said.
According to reports, India has around 1.5 million battery-powered, three-wheeled rickshaws. According to a research report prepared by P&S Intelligence, the Indian electric rickshaw market is projected to reach 935.5 thousand units by 2024. The market growth is majorly driven by government incentives and environmental policies, and electric rickshaw’s advantage over auto-rickshaw and cycle rickshaw. “In order to address the issue of degrading air quality, the Indian government launched the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme in 2015, in addition to implementing environmental regulations on conventional gasoline-based vehicles. In response, the OEMs are increasingly making investments to develop affordable and efficient electric rickshaws and the established players of the automotive industry are making inroads in this market with the launch of new electric rickshaw models,” says the report.
Lohia Group has been into real estate, exports, retail, energy and education businesses. The entry into the automotive business was the vision of Ayush Lohia’s late grandfather Narain Kumar Lohia. However, the demand for the automotive industry in India is historically influenced by prices of crude oil, for which the country depends on imports. In 2008-2009, India was also heavily mulling on renewable energies such as solar and wind to produce power. “Seeing growth in the auto industry and growing focus on renewal energy, my late grandfather foresaw the opportunity in the electric vehicle business,” Lohia said.
The company’s product designs and developments are influenced by several factors. According to Lohia, expectations of customers from electric rickshaw and scooters are completely different in the utility perspective. For three-wheeler electric rickshaws, which are for commercial utility, the company focuses on the comfort of the driver and passengers, roadworthiness and loading capacity. “These vehicles are used to earn money, so we also need to take this factor into consideration while designing and developing them,” he said. Available Infrastructure, and driving and traffic pattern also impact the design and development of electric vehicles. Lohia Auto offers 17 inches wheel size to have better ground clearance.
“For electric two-wheelers we focus on customer comfort and safety, a design which would be appealing, and on utilities.” Lohia said.
From its inception, Lohia Auto has been an indigenous company. Around 99% of components in its vehicles are made in India. Only two components, motors and controllers, are being imported. “Regarding controllers, we are going to be indigenous very soon. However, the availability of quality motors in the local market is the main challenge as most of the motor manufacturers are targeting price-conscious customers,” he said.
Lohia Auto has started supplying gasoline three-wheelers to Nepal. Though there is some demand for its electric vehicles in the Southeast Asian market, Lohia said, that market is still at the nascent stage. “I feel that the Southeast Asian markets will need a big leap to switch over to electric vehicles from ICE engines. To boost the electrification of vehicles, a big push of policies is needed there,” he said.
The recently announced FAME II will infuse Rs10,000 crore to the popularisation of electric vehicles in India. This would help the electric vehicle segment to generate demand and employment, and increase localisation, Lohia said. Through the scheme, the government plans to support 10 lakh electric two-wheelers, five lakh three-wheelers, 55,000 four-wheelers and 7,000 buses. “The FAME II is a 360-degree policy. But I feel there is a need for a long-term policy rather than having one for just three years. A policy for 5-10 years is needed to help companies draw long term plans on investments and product portfolios. IC engine vehicles also should be part of such policy,” he said.
Lohia Auto is also changing its strategies to expand its dealers, spare parts and service network. “Right now, we’re doing some changes in our expansion strategies. Instead of having expansion across India, we will be having a consolidation approach. Now the company will focus on a few northern states and expand our network at a maximum level there and then focus on the next potential states,” said Lohia. Initially the network expansion will be in Delhi, Uttar Pradesh, Madhya Pradesh and Bihar, where the penetration of electric rikshaw is higher.
Currently, the company has 120 dealers, who are responsible for sales, services and spare parts. Apart from the dealers, the company has touch points, including sub-dealers and others. The company will nurture and expand the existing dealers pan India.
Many new players are coming into the electric vehicles segment while existing auto giants are also narrowing their focus on the segment. Though the competition is intensifying, Lohia does not see this as a challenge as, he thinks, this will help the industry grow. “The electric vehicle industry needs the people who can bring in different approaches and grow,” Lohia said.
However, Lohia is concerned about non-serious players who damage the industry’s image. “In 2009-2010 when the subsidies were given for the electric vehicle industry, many companies came into this business and the market was flooded with Chinese vehicles, especially two-wheelers. These companies took subsidies and vanished from the market which had given the wrong impression of the segment,” he said.
Lohia Auto also has a joint venture with UM Motorcycles to manufacture cruiser motorcycles in the market at affordable prices. In the joint venture, Lohia Auto is responsible for their manufacturing at its plant for gasoline vehicles. “We have been taking few challenges in our ventures but definitely we will be coming to the market with flying colours,” he said.
The company will have expansion efforts on all fronts, from manufacturing, product development to R&D. “Our R&D department looks after product development, validation, road testing, evaluation and quality control parameters,” Lohia said. (