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“Ola hasn’t produced anything.” Rajiv Bajaj takes potshots at EV startups

'Picture abhi baaki hai', says Bajaj Auto managing director Rajiv Bajaj, adding that he would bet on BET (Bajaj, Enfield, and TVS).

October 29, 2021 / 01:40 PM IST
Rajiv Bajaj, managing director of Indian motorcycle manufacturer Bajaj Auto Ltd

Rajiv Bajaj, managing director of Indian motorcycle manufacturer Bajaj Auto Ltd

Bajaj Auto managing director Rajiv Bajaj launched a fusillade of potshots against a bunch of two and three-wheeler startups, warning them against taking legacy companies with a proven track record lightly amid calls by new-age entrepreneurs to shelve petrol-fired vehicles and adopt electric vehicles.

Bajaj spared no EV startup; Ola Electric, Ather Energy, Tork Motors and Smart E that either have launched products or are preparing to launch came for sharp jibes.

Betting on BET 

Bajaj said Indian two-wheeler makers have battled the four Japanese companies (Suzuki, Kawasaki, Yamaha and Honda) very successfully and in the 150cc and above segment, Indian players—Bajaj Auto, Royal Enfield, TVS Motor Company—have 70-80 percent market share. “The point I am making is that good Indian two-wheeler companies are not as lightweight as some startups would like to think we are.”

Bajaj, an outspoken automobile boss, was taking questions from the media during the launch of the Pulsar 250 on October 28, which also marked 20 years of the premium motorcycle brand.

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“So, the question is who are you going to bet on? Are you going to bet on, as they say, legacy companies or are you going to bet on the start-ups? I would bet on BET which stands for Bajaj (Auto), (Royal) Enfield and TVS. Because they are champions, they have demonstrated and they have a track record,” Bajaj continued.

Bajaj said he “enormously respects Ather because they demonstrated capability. “In Pune there is a company called Tork Motors, which will make electric motorcycles. There is this three-wheeler company called SmartE.”

Bhavish Aggarwal-led and private equity funded Ola Electric claimed it had registered pre-bookings of more than Rs 1,100 crore on the first two days in September, for its two electric scooter models, priced at Rs 100,000 and Rs 130,000. The company though has not even provided test rides to prospective customers. To be sure, Ola Electric does not have any showrooms either.

Hero MotoCorp-funded Ather Energy, led by engineer-turned-entrepreneur Tarun Mehta, has been in selling electric scooters since 2016. The Bengaluru-based start-up, which sells two electric scooters with prices starting at Rs 125,600, has steadily expanded to cover more than 40 cities.

SmartE has been making electric three-wheelers in limited markets while Bharat Forge-owned Tork Motors is yet to launch even one EV product in the market though they showcased an electric bike 6 years ago.

Swipe at Ola 

Ola in particular came in for scathing criticism from Bajaj, who has previously insisted that the automobile industry must not seek government bailout amid a crushing slowdown and poked fun at the Make in India campaign.

“There are start-ups out there that we respect. Of course, the biggest one is Ola (Electric) but we are yet to see them produce something. They haven’t produced anything yet (and so) they haven’t sold anything yet, he said.

Ola scooters are essentially readymade products from the Netherlands-based company Etergo that Ola acquired in 2020.

“ …I got no R&D, I am getting my stuff from China or Scandinavia or wherever, I got no factory, which was supposed to start in June, I haven’t made anything yet, I have an IPO coming up and I have no dealerships. So, some theory has to be spun to make a virtue of necessity,” he said.

Bajaj said it is much easier to have a real brick-and-mortar company “and put your burger in the envelope than to start with the envelope and build the company around it”. “I think we are in a slightly better position.”

Bajaj also teased Ola electric’s delivery schedule. As against the earlier committed October schedule, Ola now plans to start deliveries in January 2022— a good five months after the scooters were officially launched with fanfare.

OATS for breakfast 

“Two things are very clear today. Firstly, when we launch a motorcycle in October you will get it in November. If we launch it in 2021 you will get the bike in in 2021. From a company point of view – the business model of start-ups is a cash-burn model and our business model is a cash flow model. We have to make sure we make money when we make a motorcycle,” Bajaj added.

Bajaj said he would bet on BET (short for Bajaj-Enfield-TVS). That’s because the breakfast of champions is OATS (Ola, Ather, Tork and Smart E), according to him.

Picture abhi baaki hai.”



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Swaraj Baggonkar
first published: Oct 29, 2021 01:40 pm
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