India’s Ola Electric looks to locally assemble its upcoming electric two-wheelers

Photo: Pradeep Gaur/Mint

Cab aggregator Ola’s electric vehicle arm is in talks to onboard more than 20 EV original equipment manufacturers (OEMs) including Bosch and Samsung, as it looks to locally assemble its upcoming electric two-wheelers in India, said two people aware of the plans.

Ola Electric is expected to launch its electric two-wheelers in the European market, with production already live in the Netherlands.

SoftBank-backed Ola Electric is currently in the process of finalising the structure of manufacturing units in India, and it is looking to reduce dependence on the global supply chain by setting up a fully indigenous supply chain in the country, said the first person mentioned above asking not to be named.

“Ola Electric is currently speaking to leading India based OEMs, parts and components manufacturers. We have seen huge interest from global players to shift base from China and other markets, and the plan is to create an indigenous (manufacturing) capacity to locally manufacture 1 million EVs, mostly two-wheelers, in the next two years in India,” the person added.

Ola Electric raised $250 million from the SoftBank Group at a valuation of $1 billion in July 2019, making it the second company founded by Bhavish Aggarwal to join the coveted unicorn club of startups.

The startup is also in talks with SoftBank to bring a few global EV OEMs to set up base and manufacture in India, this person added.

In May, Ola Electric acquired the Netherlands-based electric two-wheeler startup Etergo for an undisclosed amount to expand its EV prowess. It will bring Etergo’s ‘App Scooter’ in the European market this year and in Asia next year, with India being first on the list.

However, experts and EV industry observers said that dependence on China for EV sourcing components like the battery cells will remain for the foreseeable future since China owns almost 60-70% of the world’s Lithium-Ion reserve.

According to a 2019 study by Bloomberg New Energy Finance Ltd, the world had around 316 gig watt-hours (GWh) of Lithium-ion cell capacity, of which China own 73% of this capacity. The U.S., on the other hand, owns 12% of the 316 GWh global capacity.

“EV Battery cells which are a core component of the EV have to be imported from China, US, or Europe, which can then be later assembled in India, but it cannot be manufactured locally. The other route is to work with OEMs like Samsung, Panasonic, and Bosch and then procure their batter cells and assemble in India. But Ola will completely avoid sourcing it directly from China,” said the second person cited above, also speaking on condition of anonymity.

The article was first published on Livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.