The India EV market trends have shown that 2-wheelers will lead its mass adoption. Several companies are already trying to enter this market with EV scooters and motorbikes, some of which have zero experience in the automobile sector.
A related segment that is slowly burgeoning across the country is e-mobility sharing. According to Frost & Sullivan, the gross merchandise value (GMV) of Indian shared mobility is likely to reach $42.85 billion by 2027 from $11.05 billion in 2021, expanding at a CAGR of 25.3 percent. The research agency pointed out that new shared mobility business models are gaining momentum as people rely on different transportation modes after COVID-19.
A startup active in this segment is the Bangalore-based Yulu. The company partners with the Indian automobile giant Bajaj Auto, sourcing vehicles co-designed and manufactured exclusively for shared micro-mobility.
Massive expansion to more cities with more offerings
Yulu now operates 10,000 active vehicles in Delhi, Mumbai, and Bengaluru with its swappable battery infrastructure. Speaking to Digitimes Asia, Amit Gupta, CEO and co-founder of Yulu said that the company plans to add three more cities in 2022 and about 8-10 cities by the next financial year while increasing the fleet size by 10X at the end of this year and 100X in next 2-3 years.
"We also have a business model of having Yulu services fully owned and operated by third parties in the discussion, who are keen to take Yulu service to their region/cities - and in that case, the number will be potentially much larger," Gupta said.
Yulu is also collaborating with the government agencies and assisting them in formulating the policy roadmap for EV and Battery as a Service (BaaS). The government considers BaaS a critical area of policy focus for this year, and this is also an area where Yulu actively contributes.
"We think that with our operational learning and smart technology, we can be actively involved in accelerating the growth of electric mobility in India," Gupta added. "Also, our next product, Yulu' Express', is on the road map. It is a mid-speed vehicle that is created for the e-commerce industry where they carry a high payload, and we are planning to launch this in 2022."
E-bike sales on the horizon
Since its inception, Yulu has become a ubiquitous part of a city like Bangalore. You can hardly drive here without sighting at least one of its unique-looking blue bikes that silently zip through traffic. Given their popularity, the company receives several inquiries from customers who want to buy one of these EVs.
"Every month, we get hundreds of emails from people expressing interest in buying Yulu EVs," Gupta said. "As of now, we don't sell our EVs and have had to turn those requests down. But sometime, in the future, we might come out with the option to own a Yulu EV for those people who would like to buy a Yulu scooter upfront.
This wouldn't be the same bikes that the company currently offers for shared mobility but a specially envisaged personal mobility vehicle with a unique look and feel. Yulu is now finalizing a few details and should have a clear idea of its go-to-market strategy in the next few months.
Deep global and local partnerships
Partnerships are an integral part of the EV journey, with many specialized players offering cutting-edge technology. For Yulu, deep, strategic partnerships with multinational companies like Bajaj Auto have been crucial. With continuing uncertainties and risks involved with supply chain constraints, the management would prefer to increase local partnerships.
"In Yulu bikes, 45 percent of the cost comes from the battery that is 100 percent made in India in our current model," Gupta said. "The remaining 55 percent (which is more the scooter minus battery) comes from outside. Going forward, there is going to be a change in this with many more critical components being sourced locally, thus reducing our dependence on the global supply chain significantly."
Gupta added that the post-covid supply chain constraints had impacted them mildly, but the company is now well-positioned to move forward with its plans. Most Indian EV companies hope that government incentives and market demand would encourage more supply chain partners to come up in India.
India's obsession with 2-wheelers to drive demand
India has always been a two-wheeler country, with the number of car owners remaining way lower than those who own scooters and motorbikes. Yulu believes this trend will continue with EVs and expects demand for shared e-mobility and swappable batteries to stay strong.
With a unisex design that makes riding convenient for anyone above 16 without the hassles of ownership, Yulu has managed to capture a substantial market. With more partnerships and expansion plans, the Indian customers may see the company play a more significant role in the local auto market.