Benglauru based Ola Electric has finalized plans to launch an electric autorickshaw, reportedly named Raahi, directly targeting consumers. This move underscores the company’s strategic expansion into the electric three-wheeler segment, aiming to compete with established players such as Mahindra Treo, Piaggio Ape e-city, and Bajaj RE.
“Ola Electric is looking to make a slew of announcements, including on the gigafactory, in the next few months ahead of the listing. The e-autorickshaw is part of the same plan and internally the target is to do it over the next two weeks or so,” a person in the know told ET, adding that the timelines may change.
Development and Competition
The upcoming electric autorickshaw is a culmination of Ola Electric’s efforts over the past few years to diversify its product portfolio and enter the commercial vehicle market. The development of Raahi is part of a broader strategy leading up to Ola Electric’s anticipated IPO, aligning with its goal to raise funds and strengthen its market presence.
Strategic Moves Preceding IPO
Raahi, which means traveler in Hindi, symbolizes Ola Electric’s strategic thrust ahead of its impending initial public offering (IPO). The company’s decision to unveil Raahi aligns with its broader objective of diversifying its product portfolio and garnering investor interest. With a draft red herring prospectus (DRHP) filed in December last year, Ola Electric aims to raise significant capital, potentially up to Rs 5,500 crore, through a fresh issue. This capital infusion, coupled with an offer for sale of 95.2 million shares by existing investors, underscores the company’s commitment to fueling growth and expansion.
Focus on Two-Wheeler Segment and Infrastructure
In preparation for its IPO, Ola Electric is intensifying efforts to consolidate its leadership in the electric two-wheeler segment. Initiatives include extending battery warranties, expanding the fast-charging infrastructure, and enhancing service center networks. Additionally, the company has listed a four-wheeled vehicle as part of its future plans in its IPO documents.
Gigafactory Expansion Plans
Ola Electric is also progressing with its gigafactory plans, earmarking a significant portion of the projected IPO proceeds for this purpose. Founder and CEO Bhavish Aggarwal has indicated the firm’s commitment to manufacturing battery cells internally, with plans to establish the gigafactory by the end of the current quarter.
Electric Autorickshaw Market Dynamics
In the electric autorickshaw market, players like Mahindra, Piaggio, and Bajaj offer a pricing spectrum ranging from Rs 2.0 lakh to over Rs 3.5 lakh, contingent upon the model and additional features. The pricing variability reflects the diverse preferences and requirements of consumers within this segment. Notably, government data from the transport website Vahan indicates a significant surge in the adoption of electric three-wheelers, with sales exceeding 580,000 units last year, marking a notable 66% increase compared to 2022. This robust growth underscores the accelerating momentum towards electrification in the three-wheeler space, with electric variants constituting more than 50% of total three-wheeler sales in 2023.
