Full transcript: Bhavish Aggarwal's exclusive interview at Green Bharat Summit

Bhavish Aggarwal: Wait and watch, Chandra. So we will be sharing more. But you know, this is, like I said, this is the inflection point for India's EV journey, India's green journey. And like the name of this event is, it's the inflection for Green Bharat. And the inflection means we have to actually make every common man in every nook and corner of the country be able to access the best quality products. So, you know, that was our goal with which we said, we have to open 4,000 stores. And we are actually going to make it happen. It's going to be, it's been a very challenging jump because, you know, unlike incumbent companies, we don't have an existing distribution. So, and we have a model where we own all our stores. We don't have dealerships. And we are actually right now, we have 3,000 construction sites across the country right now.

Chandra R Srikanth: Right, so on a scale of 1 to 10, 4,000 by December 20th, how confident are you?

Bhavish Aggarwal: 11. Well, the boys who are going to make it happen were on the panel today. So, you know, we're all running towards it. It's going to happen. And it's also, Chandra, the kind of interest we have from the upcountry in India to buy EVs, you know, you'll be surprised to see people in small towns, villages, want to buy the best in class EV. They've been pulling us, saying, open a shop with us. More importantly, open a service centre with us. So, that's what this one-time jump is about. And, you know, this is going to obviously serve our existing products, but also as we bring out motorbikes, et cetera, which are even more relevant in small town India. So, it's going to be one big move towards accelerating electrification in India.

Chandra R Srikanth: So, how many hours a week have you been working, Bhavish, towards this goal?

Bhavish Aggarwal: I am not going to join this argument anymore. You are the one who, you know, aap sabko...

Chandra R Srikanth: No, no, I'm not going to get you into trouble. Don't worry.

Bhavish Aggarwal: No, but jokes apart, Chandra, you know, I feel, I actually think the young people of the country, you know, when we tell them 70 hours, 15 hours a day, et cetera, and I've been guilty of that, they wouldn't like it. But I actually feel the young people of our country want more purpose. And what bigger purpose can there be to build the future of the country, right? And through a vision like building the EV future of the world in India, building India into a clean energy, green energy country, I mean, this purpose drives all youngsters. And I see in Ola itself, we have so many youngsters jo mujhe zyada kaam karte hain. Forget how many hours I work. My team works 20 hours a day.

Chandra R Srikanth: My God. But, Bhavish, you know, one pertinent point that came up in both Union Minister Piyush Goyal's fireside chat as well as Nitin Gadkari's fireside chat is they believe that the EV industry should get out of the subsidy mindset. In fact, both of them have said that, you know, subsidies are okay to kickstart something to give the initial trust, but any industry that expects to remain subsidized beyond the initial few years can never be successful. I wanted to get your thoughts on this because if you look at China, you know, their subsidies continued for many more years. Here we are sort of thinking about pulling the plug on fame, you know, after, you know, fame one, fame two. But for this industry to grow, to kind of make those strides, what is your own view on subsidy?

Bhavish Aggarwal: You know, Chandra, I have a, I agree with what the ministers have said. And I think they've also said it in a nuanced way, which is that the government, firstly, has been very thoughtful and progressive when it built an incentive framework for the EV industry. And there are multiple layers of incentives for multiple types of value-add. To the average consumer, there is the fame or the PME drive scheme, which is tapering off. It's been tapering off for the last two, three years. And like I've said this in the past, that I actually feel it should go away. Consumers don't need any EV subsidies now. And the government has a one-and-a-half-year-old roadmap for the PME drive subsidy, and after that, it will go away. Then there are subsidies like the, which are more incentives, the PLI schemes, which I believe are still required to encourage more and more localization and more and more local manufacturing of EV and components. And we are actually the biggest investor across both the PLI schemes, PLI for EV and PLI for lithium-sep. So we're the biggest investor. We have the biggest capacity installed across both these schemes.

And the government, again, like I said, has been very thoughtful in bringing out these schemes. And now there is talk about potentially bringing PLI for cell components, just like we have PLI for EV components. So that theme of PLI incentives for localized manufacturing of components, I think is a strategic theme, which we should continue. And the government has shown very clear interest to double down on that. You know, I also want to, on this topic, step back a bit and share the bigger picture of how Green Bharat is very strategic for India's long-term, India's journey towards Viksit Bharat.

You know, if you look at our generation, Chandra, and you and I are a similar generation, like most of the people in the audience, I presume, for our generation globally, the biggest challenge is going to be climate change. The world is trying to come to terms with climate change. People in the western parts try and leverage their strengths in supply chains or financial markets to lecture our country sometimes, like the Honourable Minister said that we have to continue with coal, but our long-term vision is to go towards a cleaner power grid also. For the world to combat climate change, it can't do it without India. India is 20% of the world's population. And not just that, India is a great leader of the global south, politically as well as technologically, as well as in terms of how consumers behave, the cost structures. India is a great microcosm and leader for the global south.

So, like in the west, you have iconic companies like Tesla, etc., solving for climate change. All of that included, even China included, is largely a billion people out of the 8 billion people. So for the world to achieve a sustainable climate paradigm, India has to electrify, India has to make its grid green. And in that sense, India will be building products and technologies for the rest 7 billion people in the world. That's the scale of opportunity we have in front of Green Bharat. So in the near term, we are incentivizing, etc., but the strategic objective of the whole ecosystem is that we have to make the world's largest EV hub in India from product manufacturing, EV manufacturing, EV components, lithium cells, the whole chain. And that's where Ola Electric is actually the leading company across the whole chain, setting up these kind of capabilities and technologies in India.

Chandra R Srikanth: Right. Bhavish, you know, while you spoke about how you have doubled down and tripled down, both on the vehicle side and the battery side, we also had Amitabh Kant this morning, the G20 Sherpa, and he had a very dire warning for the auto industry in India. So he said while EV penetration in China has crossed 50%, Europe 23%, US 10%, India is just 2%, and he went on to say that, you know, our manufacturers are at least 5 years behind the curve. They haven't really capitalized on the opportunity despite the government's policy push. And now with the US clamping down on China, the market is wide open for Indian automakers to go global, but they haven't shown as much intent as they should have. And he has, you know, he said that this also extends to battery. He said that the world is doing 1000 gigawatts of battery storage, we have 0. So, you know, where is the fault line lie? How much blame should the industry take? Or, you know, are we really too early in the game and we will see these changes pan out, say, in the next 2-3 years? Some of these investments play out in the next few years.

Bhavish Aggarwal: Chandra, the government has done more than enough in my view. The government has brought in a policy, it has brought in procurement of new technologies, it has brought in an incentive and subsidy framework, it has brought in encouragement for entrepreneurs like me. So, I think it is the onus of the entrepreneur and the industrialist to really take this opportunity up. And we have a unique once-in-a-generational opportunity, and you know, if you look at all large countries, large industrialized countries, they have always had a large automotive industry because it is around the automotive energy industries where other industries grow.

So, it is one of the anchor industries for any large economy. So, we have a once-in-a-generation opportunity to really lead the global wave of green technologies because the world needs partnership, the world needs low-cost high-technology EV manufacturing, lithium cell manufacturing, and the only such alternative the world sees is China right now. And the world doesn't like what it sees over there. So, India has a unique opportunity to really build a global scale industry in EV products and EV technologies and components like lithium cells, motors, rare earth metal supply chains, etc. And I feel while we are at the very early stage, but if you see, we have had a strong change in the last 2-3 years. When we began our journey 3 years ago, EV penetration in India was 0. And today, in scooters, which is where our effort has been in the last 3 years, EV penetration is 25%.

So, similarly, across all categories, you will see actually a sharp inflection over the next few years. And like Amitabh Kant said, by 2030, these technology curves are not linear. They are S-curves, as we all know. Once the momentum builds, there comes a time when it just skyrockets. And we have seen this technology after technology up. You can see it in the quick commerce space. You saw it in the food delivery space before that. You saw it in the ride-hailing space. Now we are starting to see it in the EV space, 4G, 5G. So, we are at that inflection point now. And the next 3-4 years, there are going to be a bunch of important vectors which are going to accelerate this. Firstly, the customer. And India is a consumer economy, right? The consumer wants EVs very, very clearly. If there is a great EV product, he or she will buy EV. Number 2, the cost of technology, which is the lithium cell fundamentally here, is only falling like this. And that's the beauty about technology, that if we invest into the future technologies, technologies only improve productivity of capital and labour.

So, the cost keeps falling. And already we are at a place where, maybe in a couple of years, EVs will be without subsidy cheaper than ICE vehicles. And that's further going to inflect the industry. So, I fully agree with Amitabh Kant that we are staring at that inflection. For companies like me, which are all electric, we feel very excited about the opportunity. There are some companies which talk about their green portfolio having natural gas, etc. I don't see that being the cleanest approach. It is cleaner than petrol, but there's nothing as clean as electricity.

Chandra R Srikanth: I wonder which companies you're talking about, Bhavish, if you want to name them.

Bhavish Aggarwal:  No, I will skip the names.

Chandra R Srikanth: Bhavish, you've also been very vocal about your focus on battery tech. In fact, we had an opportunity to see the kind of investments you're making in the Ola gigafactory in the outskirts of Bangalore, close to Krishnagiri district. So, give us an update on that. When will we see these Bharat cells powering EVs in India?

Bhavish Aggarwal: Chandra, I was there at our factory all day today. I just came back for our session. The factory is coming up to speed very fast. In fact, the factory is all ready. We are producing thousands of cells every day. We are being very rigorous about the testing and the quality testing. So, thousands of cells being produced every day, being put into tests, rigorous tests, high temperature tests, high speed charging, discharging. So, we are on track. We've guided the street to Q1 FY26. My effort is to make it faster than that, which is just 3-4 months out. We are very keen to get our cell into our products. Also, the lithium cell is going to be a platform for product innovation in India. If you think of so many categories of products, be it other automotive categories, drones, power tools, medical devices, consumer electronics, any kind of consumer, any kind of these products will need lithium battery cells. Today, we import all of that from China. So, our lithium cell, I hope, and I'm going to position it as a platform for all startups, for Startup India to really use and build more and more products around it for the Indian market.

Chandra R Srikanth: Give us an update on your product portfolio, Bhavish, in terms of the Ola motorcycle and any rethink on the four-wheeler plans?

Bhavish Aggarwal: The next year is going to be the year of product for Ola Electric, Chandra. So, this whole year, we've been focused on consolidating our operations, making them more efficient, and also engineering the product behind the scenes. Next year, you will see, in 12 months, we will launch maybe one product a month. Our motorcycles are going to be out around March. Our next generation scooters are going to be out before that. Our auto rickshaws are going to be out maybe in the middle of the year, and then more high-end motorcycles towards the end of the year. Our focus right now is to build these two- and three-wheeler products.

Like I said, India is the biggest market for these small mobility products. You'll be surprised, and the audience will be surprised to realize and maybe some will know that two- and three-wheelers in India consume more petroleum than four-wheelers in India. So, for India's macroeconomic advantage, for India's pollution to get better managed, all of it, electrifying the two- and three-wheelers is a very central piece in the whole puzzle there.

Chandra R Srikanth: Right. Bhavish, you know, in terms of the 4,000 stores planned, will that also help you claw back market share in the electric two-wheeler space? Are you confident of coming back to the top position?

Bhavish Aggarwal: 100%. We had launched our stores to about 800, about one-and-a-half years back, and then we spent the next one-and-a-half years consolidating our operations in those stores. All this while, to the credit of the other incumbent competition, TVS and Bajaj and others, they grew into their existing stores where they sell ICE vehicles. We said, okay, we have to do this in true Ola style, so we said we'll just in one go launch, take the distribution or store network advantage out of the equation, and that's what we're doing. We feel very confident that it'll help us claw back the market share, and steady-state market share for our scooter portfolio, we expect to be around 35% to 40% as a leader.

And it's not just market share, Chandra, it's also market share with margins. If you saw last quarter, our gross margins were 28-plus percent, and our gross margins are only going to improve as we go along. And the broader theme here is, if you think of the winning strategy in EVs, the long-term winning strategy in EVs, there are only two companies in the world which have delivered scale, market share leadership, and profitability. It's Tesla in the West and BYD in China. And the strategy is, the common theme is that they're all vertically integrated in technology and manufacturing. And we are the only such company. We make our own motors, we make our own battery packs, we make our own cells, we make our own electronics, we do our own software, and we do our own machines in the factory. And that helps us keep our margins high, as well as keep innovating very fast. And that's the winning strategy. And as long as other companies don't do a similar strategy, I think they'll find it hard to maintain a balance of scale and profitability and margins.

Chandra R Srikanth: Right. Bhavish, do you think price cuts will also help? Because GDP is slowing down, there is concern about consumption sputtering in India. Do you think price cuts will also help, apart from this aggressive store launch across the country?

Bhavish Aggarwal: You'll see. I don't want to let the—

Chandra R Srikanth: Cat out of the bag.

Bhavish Aggarwal:  Cat out of the bag right now

Chandra R Srikanth: So that means a price cut is coming?

Bhavish Aggarwal: You know, the beauty about technology, Chandra, is that it keeps reducing costs. We've seen that in industry after industry. So with our Gen 3, with our own lithium cells, our margin advantage will only increase. So at some point, we will definitely pass on some of that to the consumer. But as you say, just to digress a bit on the macro economic point on GDP growth, I actually feel GDP growth slowed down in the first half of this year, due to maybe lower investment in infrastructure, etc. from a more government side, which has now picked up pace again. So I don't foresee any major structural challenges on consumption or GDP growth for India in the near term.

Chandra R Srikanth: Bhavish, also, is a lot of your bandwidth going towards resolving customer complaints, ensuring quality is at par? How much of your time is going towards that every day?

Bhavish Aggarwal:  We have completely resolved all the service backlog that we had. And we actually, you know, it was not as much a major complaint issue. It's that we didn't expand our service network fast enough. And that's something that we learned a lesson from this, because we had grown our sales very fast. And we had not grown our service network fast enough. And automotive, in the end, even if the customer doesn't need service, he'll still, once every few months, bring it in. Especially a new technology like EVs. So that's actually, as we are now expanding, we are making sure every store has a service centre from day one. So that gives confidence to customers to buy EVs at the beginning itself, in their journey towards EVs. So customers should feel confident. We are opening service centres everywhere. No backlog remains. We are looking to the future.

Chandra R Srikanth: So how much, you know, of your bandwidth is going to your various businesses? Because you're in AI through Krutrim and Ola Electric and battery and cab aggregation and, you know, quick commerce through, not quick commerce, food delivery through ONDC. How are you going to divide your time?

Bhavish Aggarwal: I have a brilliant team, Chandra. You saw my team. My team was through today and they know their subject better than me. And that's the thing across all our companies. My time primarily right now is focused on Ola Electric to make sure we scale the EV opportunity in India very quickly and to make sure things like the Gigafactory etc. also become larger. You know, for example in the Gigafactory we have a 4-5 year lead over anybody else in India because we started 4-5 years ago our Gigafactory journey. So we are very keen to make the most of this leadership position that we have and I'm very singularly focused on scaling up Ola Electric.

Chandra R Srikanth: Right. As we wrap up, Bhavish, it's been a few months since Ola Electric went public. What's it like running a publicly listed company? What has changed for you as an entrepreneur? What has become easier? What has become difficult? What's been the key learning?

Bhavish Aggarwal: Chandra, I feel you know, I'm looking at this change not from a what is easy or what is difficult lens but I'm looking at it as what is it that I have to learn more? Right, because it is a journey we have to go through and for me the biggest emotion or the feeling that I carry is a much stronger, deeper sense of responsibility that we are managing people's money and especially all the mutual funds and all. It's all So we have to allocate it wisely. We have to make sure we deliver returns and deliver long-term returns. People have invested in us, believed in us. So, you know, it's incumbent upon us and the whole Ola Electric team to deliver into this future of Green Bharat and make sure shareholders make money.

Chandra: Right, here's wishing you the very best on your journey of Green Bharat. A huge round of applause for Bhavish Aggarwal. Thank you, Bhavish, for giving us time, for taking all our questions and we hope to meet you in person soon. Thank you, Bhavish.

Bhavish Aggarwal: Thank you so much, Chandra.