For those, who donot know OLA: OLA is UBER of India, although Uber is also there in India.
And EV stands for Electric Vehicle.
In early days of COVID lock-down, I remember reading an author being skeptical about Ola EV becoming an Unicorn (evaluated more 1 billion $), despite zero revenue (yes zero revenue, forget profits). Later around Diwali, I read OlaEV signing MoU with TN govt to set up a mega 2 wheeler EV manufacturing in Krishnagiri (I will come to Krishnagiri again) . I brushed it aside, thinking 1000s of such MoUs are signed. Being from Odisha & experience of Posco, I am no fan of signing of MoUs events.
Recently, one more article came, showing fast progress happening in Krishnagiri site. This time , I took it seriously, & realized Ola is indeed serious on this & betting very (would add another very) big on this.
So decided to document my thoughts , so that I can reflect back again in 2025.
In nutshell, I firmly believe (& my Marwari brain says so) Ola will succeed in this. I want it to succeed, not to prove my point, nor I have any equity in Ola (but will surely put, if an avenue is available), but for following reason:
1) an Indian company will do what no one is yet to do in world: “Mass” carbon free adoption in mobility sector
2) it will be good n positive step for climate change problem.
So, in this write up, I will jot down my thoughts: why Ola EV will succeed & what challenges are there?
KRISHNAGIRI… “woh bhi kya din the…”
But 1st to Krishnagiri site, where Ola is setting up, what can be called as Giga factory for 2 wheeler EVs. If realized completely (2025 expected), mammoth 10 million 2 EVs /yr will be manufactured.
Krishnagiri, I have something personal to share with this place. A small, but beautiful town , ~100 kms from Bangalore, in Tamil Nadu. It’s on NH7 ( n part of famous Golden quadrilateral), & while driving from BLR, after District collector office, left turn at a junction, will take to Chennai (NH46) & straight will take to Salem/Madurai (NH7 continues).
Wondering, how I know so much. Reason, I have driven my bike more on BLR-Krishnagiri highway than BLR roads, during my 6 yrs stay in BLR. It was(may be is) such a beautiful & pleasant ride, that I used to simply go out for a ride, if nothing to do on a weekend. I still remember driving non stop 1 hr, without changing gear (except on one toll gate, where I changed to 3rd gear , because of hump). Old sweet memories. Not sure, how are the roads now..its been 10 yrs. I have written many praises about Krishnagiri, in my travel blogs of those days. (One of those: https://omus.wordpress.com/2011/01/23/cholaland-tour-14-16th-jan2011/)
3 VERTICES OF A NEW BUSINESS…
FOCUS, FOCUS, Back to subject: So why I think , Ola EV will succeed. To answer it, I will use a criteria, which Bill Gates gave in his recently launched book “How to avoid Climate Disaster?”. He says for any new business to succeed, three things have to rise together : Policies, Technology & Market of that business.
So, let’s evaluate these three for Ola EV.
1st: Policy: in view of climate change & govt push towards electrification of mobility, this won’t be a show stopper. Yes, Indian regulatory & policy is always a challenge for any business- new or old, but things will work out. Govt itself is pushing for EV & thus will make sure, they themselves are not the hurdle. Also, success of Ola mobility (which had/has a political angle, involving powerful taxi unions) since 2014 & other new tech business in last 10 yrs or so, gives hope, that policy & regulatory won’t be a challenge. Innovative PLI schemes, subsidies to kick start electric eco system, fast land allotments.. all points out that for Ola EV, things are sorted out in policy front. Only thing, they should remain apolitical, i.e. keep buttering all political parties.
2nd: Market: As the saying goes, Indian consumers are always ready. Give value for money, and they will be accept ENMASS, in NO TIME. So, market is there, it’s dormant. All it needs, is a right priced value product to get active. Jio, share mobility, digital transactions etc. are classic example of last 5 yrs, where new product became market leaders in no time. So, market for Ola EV is not a problem. 2nd criteria ticked.
3rd: Technology: it comprises two aspects (a) proof of technology (b) Cost of technology. Former is again ticked, and all aspects of EV mobility is well proven. Already, EV penetration is reaching in % levels.
Second part, cost, is what remains a challenge & the reason why EV is yet to be accepted enmass. This is where the plan of Ola EV clicks & addresses the issue. They are straightaway going in a big scale, to bring in economies of scale, rather than wait for another decade for it to come. Somewhere, concept of Tata Nano, Jio , is coming here. Ola EV is bringing up with them, complete manufacturing ecosystem, so that costs can come down. As per released plan, imports will be minimal (target is 10% only, which also is slated to become zero in a decade) , thus cost will come down. If this succeeds, 3 key things will happen:
1) Mass acceptance of EV
2) India will become new tech manufacturing hub
3) Certain % of pollution & hence climate change aspect will be taken care of. FYI, “How we move around” accounts for 16% of global green house emission (Source: “How to avoid climate disaster”, by Bill Gates)
Thus, things are in right direction and all three corners of triangle, as specified by Bill Gates, are being taken care of. So, if executed as per plan, OlaEV , in fact, whole Electrical mobility will be a big business to be in.
CAN OLA DO/EXECUTE IT, SUCCESSFULLY?
So, next question, does OLA has in it, to make this plan successful. Again, short answer is YES. It has all the required masala to be execute the plan (of which time is also an important aspect). Why I said YES:
1) Capital: Ola has enough capital, plus backing to execute it. Now I realize, author criticizing OlA EV becoming unicorn, without any revenue, was wrong. Basically, investors are sold to idea & they are ready to back up with equity.
2) Technology: Ola has selected (in-fact acquired Ertego, Netherland based 2 wheeler EV company) right 2 wheeler EV model. EV bike with battery swap & >150 kms range. Battery Swapping is key word here. I still don’t understand, why other EV developers are sticking to fixed battery. 5 hrs of drive followed by hrs of charging, is so unappealing, as a consumer.
3) Infrastructure: Ola is working on this as well, with chains of outlets to swap or recharge battery. Technical solution to this is already available with ola (maps, gps etc.) So not the technical aspects, but scale is the challenge, but can be conquered with deep pockets, which Ola has.
4) Finance: This is where OlaMoney experience & platform will come handy. Zero/low interest loan, insurance etc. can be easily taken care by Ola.
5) Reach to consumer: should be cake walk for ola. Ola themselves will be a big customer, in form of Ola mobility. Plus Tying up with new age techs like Zomato, Delhivery etc. will bring in quick market. Simultaneously, individual consumer market will also come.
6) Management: last but not least WILLPOWER . I need not write on it. In just few year, word taxi has been replaced by Ola, in India.
So, all the required arrows are their in Ola quiver to execute this dream plan.
RISKS…..
So, I talked only goodie, goodie, that doesn’t mean , there are no risks. Risks are there:
a) All eggs in 1 basket: to get economies of scale, Ola EV is taking risk, by putting one mega plant. 1 political issue & doomed. But then, this risk has to be taken.
b) Tata Nano fate: Nano was launched with same enthusiasm. There are too many similarities in OlaEV & Tata nano strategy, which points out that OlaEV too have certain probability to go wrong after launch & fail like Nano. Ola hopefully have learnt mistakes of Nano & definitely would cover up in their execution.
c) Politics: this is a risk for any business & continues to remain same. It can be competition politics as well (compete with Oil). There’s enough hints, ola has this covered & know how to address this risk.
d) Breakthrough technology: but nothing in visible as of now. Hydrogen vehicles will be complementing & not competing.
Thus, I see all risks are manageable for OlaEV & none should be a show stopper.
After evaluating & debating with myself, I conclude OlaEV should be able to execute this plan. A bike costing <1 lac Rs (100,000 INR) & >150 kms/charge + anywhere-anytime battery swapping facility, is sure shot recipe of success. And seeing it’s overall impact, we should all wish, they succeed in this.
After execution, what will OlaEv in totality look like or what they will offer:
1) EV Bike : of-course variety of models. Example: with or without battery swap option. I will always go with later.
2) Infrastructure: Battery swapping & charging outlets, through out the country.
3) EV fleet & mgmt: to bulk users like Swiggy, Courier companies etc.
4) Finance: Zero or low interest loan for buyers. Insurance, maintenance & buy back schemes.
5) Dealership & Company own outlets: selling & servicing. Anytime & anywhere breakdown assistance.
6) R&D for improvement & also carrying this success into new products like Cars etc.
7) Renewable sector: to ensure Carbon free electricity to OlaEV, Ola may enter in this sector.
ELECTRIC BIKE vs TRADITIONAL BIKE…
Next Q that comes, can a EV bike still compete with traditional bikes. Short answer YES. It will replace traditional bike, thus few of the existing 2 wheeler companies can have their KODAK moment by 2025. Below comparison table , explains the reason.
More Entrepreneurs…
Ok. All good. What else? It will give rise to new entrepreneurs , i.e. scope of new business in :
A) manufacturing EV parts/ accessories
B) Dealership / garages
C) retail Shops for parts n accessories
D) software solution providers
E) battery swapping n charging outlets
F) finance.
Any takers for these new businesses? You can count me in 😉
Concluding: OlaEV has it all & can do to EV mobility sector, what Jio did to telecom sector. So, Best of luck Bhavish Agarwal & I will pray for your success. In your success, is our success as an Indian citizen, as well as a global (Earth) citizen.
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