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This post is a part of EV Next’s EV Perspectives. EV Next, a division of EAI, is a leading market intelligence & strategic consulting firm for the Indian e-mobility sector.

Mahindra Electric has been a pioneer in the Indian electric vehicles sector. Ever since they acquired Reva Electric in 2010, the company has had a focus relatively higher on the e-mobility sector compared to the many of the rest of India’s automobile companies (though companies such as TVS. TI, Hero, etc had had occasional flings with the EV sector during the 2010-2016 period).

When momentum in the Indian electric vehicle sector started accelerating from early 2018, the company has been in the highlight, and it was only natural that much was expected of it, as it had one of the highest brand mindshare when it came to anything EV in India. It rebranded Reva NXR as e20 in 2013, which was upgraded to e20 Plus in 2016, which in turn was discontinued in 2019 to pave way for a higher focus on the second electric car brand from the Mahindra stable, the eVerito.

The American steel titan Andrew Carnegie is supposed to have said, “Pioneering don’t pay,” and while unfortunate, it is true. Markets are fairly ruthless, and if you are a pioneer, you might also feel they are ruthlessly unfair. Markets don’t care if you are pioneering, they attach little value to all the sweat and efforts you put in trying to innovate and create a market. They mostly care about whether you have a product that fills that satisfies their needs.

Folks at Mahindra Electric might readily agree with Carnegie. Well, for all its pioneering efforts in the past 10 years in the electric car space, Mahindra Electric actually had very little to show in terms of sales and actual market creation for electric cars. It was not because it was a lack of effort or lack of application of mind. At EV Next, we think they were a bit too early to the electric vehicle space and more importantly, they had focussed on the most difficult electric vehicle to sell in the Indian market – the electric car.

While Mahindra has clearly been a pioneer in the Indian electric vehicle sector, the company has not been able to move the needle much last 10 years for electric vehicle growth in India

For the Apr-Nov 2019 period, it was reported that eVerito sold about 500 units, so about 60 units a month. Hardly anything to write home about for a company that has been selling electric cars for almost a decade, and in a country where the total number of (conventional) cars sold every month is over 300,000. These numbers must have made the top honchos at Mahindra Electric realize that it was time to do something and arrive at a new strategy. And the following appear to be the key facets of their renewed thrust, based on a recent news report.

  • Shared mobility
  • Transport services
  • 3-wheeler focus

Shared mobility

We think this pattern has been read by many industry watchers, and this includes Mahindra Electric: some of the earliest adopters for electric cars would be the fleets, be they the Ubers of the world (because of government mandates) or companies such as Lithium Urban (whose business model and emphasis depend on use of electric vehicles). If one sits down to do a bit of analysis, the strong business case EVs presents for this segment also becomes quite clear.

Mahindra Electric has clearly bought into this trend and today is shifting its electric car sales emphasis towards Lithium Urban and its ilk (in fact, it was heard at a conference that a dominant % of total miles traveled by eVerito is actually contributed by Lithium Urban).

Fleets and shared mobility segments is a clear growth segment for EVs of all types, and not just in India

Transport services

This is a case of integrating along with the value chain, in this case, going downstream. Mahindra took a majority stake in Meru Cabs in Sep 2019. The cab service provider operates in 23 cities and has been reportedly doing quite well. By owing Meru Cabs, Mahindra now has a ready captive consumer for its electric cars. This reminds me of how solar module makers became solar power plant developers, which made them their own customers of their solar modules. It is a strategy that has worked fairly well in solar.

3-wheeler focus

This is, compared to the above two, a fairly obvious opportunity. For the uninitiated, India sold over 7 lakh electric 3 wheelers in 2019. Compare this with about 1 lakh electric scooters, about 2000 electric cars and a few dozens electric buses sold in the same period – the electric 3 wheelers sales in India in 2019 were more than five times of all the other electric vehicles put together. This also puts India as a leading market globally (if not the clear leader) for electric 3 wheelers.

India is already a global leader in electric 3 wheeler sales, a statistic that is under-reported and under-appreciated

That’s quite an amazing and hardly appreciated statistic. Now, to be precise, a large % of these electric 3 wheelers were the clunky electric rickshaws, the ones you would have seen on Delhi roads. But the more elegant electric autorickshaws are also doing brisk sales.

It should thus not be a big surprise that Mahindra was attracted to this market.

So that seems to be the three-pronged strategy for Mahindra Electric to propel them to a leadership position in the Indian e-mobility sector.

Of the three, at EV Next we feel the first (focus on shared services sector) appears the smartest. Why? This is where Mahindra’s strengths (product, engineering, maintenance, support) gel well with the strengths of an innovative startup such as Lithium Urban (nimbleness, innovation, unique business model, new tech). Such synergies can lead to significant entry barriers.

If Mahindra could repeat this with five such Lithium Urbans across the country, growing each while perfecting the entire manufacturing and support value chain geared towards this segment, they achieve scale in a fairly economical manner – neither of which (scale or economics) is available for electric cars in the conventional B2C or B2B markets today.

The other two – owning a transport service and becoming a 3-wheeler OEM – appear much less optimal. Each of these two sectors is highly competitive in themselves, and it is difficult to see what strengths of the Mahindra Group (other than its significant financial clout) could really move these companies ahead of the competitors. In our opinion, these two can be supporting strategies, with the Lithium Urban partnership the key one for their success in the electric car segment.

What do you think?



This post is a part of EV Next’s EV PerspectivesEV Nexta division of EAI, is a leading market intelligence & strategic consulting firm for the Indian e-mobility sector.

Know more on how EVNext can assist your business in your strategy for the e-mobility and electric vehicles sectors, from here. Know more.