Ola wants to be the Tesla of affordable EVs
Ola wants to own the entire value chain—from engineering, manufacturing and sale of electric vehicles (EVs)—beginning with electric scooters and then small electric cars.
Bengaluru: Ola is seeking to transform itself from being a mobility services provider to a player in the burgeoning low-cost electric vehicle (EV) market globally, modelling itself on Elon Musk’s Tesla Inc.
The Bengaluru-based ride-hailing company wants to own the entire value chain—from engineering, manufacturing and sale of EVs—beginning with electric scooters as early as the middle of this year and then on to building small electric cars in the near future, it said…
“Our ambition is to have a big impact in electric vehicles,” said Bhavish Aggarwal, chairman and group chief executive officer, Ola. “The only way we can create impact in electrification is by playing at scale. This business cannot be built by selling 2,000 vehicles a year.”
Aggarwal, speaking to media persons at Ola Electric’s 500-acre new EV manufacturing site—FutureFactory—near Krishnagiri in Tamil Nadu on Friday, said the plant will have an annual capacity of 10 million units by mid-2022.
Built on the lines of Tesla’s Gigafactory in Nevada (US), Ola’s main manufacturing unit will span 43 acres and is about two-thirds the size of the US EV maker’s biggest manufacturing plant.
Ola said it was looking at a phased development of the factory, with capacity for the first two million units being set up by June this year and an all-electric scooter to be the first product to roll off the line.
The upcoming plant will also house a separate battery manufacturing unit that Ola will operate, apart from buildings set up by around 50 vendors on around 240 acres. This will allow Ola to source around 90% of its materials locally, the company said.
“Most of the incumbents of pure-play EVs like Tesla are focusing on the premium or luxury markets. But if you look at the most number of units sold or gasoline consumed or kilometres travelled every year, it is by urban mobility vehicles,” said Aggarwal. “We believe that we can put India on the world map by focusing on urban mobility vehicles.”
Ola said it had designed, engineered and will manufacture its own batteries, motors, charging and motor controllers and also the software that will power scooters, helping keep costs down. While it will import lithium-ion cells from South Korea for now, it will look at local manufacturing with partners as the scale of its EV business grows.
The company said 20% of the factory’s power needs will be met by rooftop solar panels and will be carbon negative. It will also have over 3,000 industrial robots to automate several critical and hazardous tasks and will create 10,000 direct jobs for Ola alone.
As for Ola’s ride hailing business, the company said the recovery following Covid-19 induced lockdowns has been strong and expects full recovery by mid-2021.
Once this happens, the company will continue expansion plans, including into new global markets. It will also leverage its existing financial services business to support its EV business.
“Our focus was to build mobility for the future and 10 years ago the biggest disruption was shared usage or the mobility services business model. We’re one of the top five companies in the world today in that space, but our bigger ambition has been to build sustainable, safe mobility for everyone and not just mobility services,” Aggarwal said.