Tarun Mehta: Ather will need few more years of external capital, govt subsidies to grow: CEO Tarun Mehta

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Electric scooter maker Ather Energy will continue to require external capital for a few more years for growth, cofounder and chief executive Tarun Mehta said on Saturday.

At the same time, the overall two-wheeler EV industry would require government subsidies to continue to grow at a healthy rate, he added.

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Urging for a third version of the Faster Adoption and Manufacturing of Electric Vehicles (FAME) subsidies, Mehta said that a “critical and sunrise sector” like two-wheeler EVs “could see degrowth with some products becoming unviable” if subsidies are pulled back too quickly.

The comments come as the government withdrew FAME-II subsidies at the end of March, moving on to the Rs 500 crore Electric Mobility Promotion Scheme (EMPS), 2024. On Saturday, ET reported that Ather, Hero Motocorp, Bajaj Auto, TVS, Ola Electric and Kinetic Green have received approvals to claim the subsidy.

Mehta added that the firm would continue to look for external capital, but that the funds would be used to launch new products and grow the business instead of “handling business cash losses”. He did not offer

details of future fundraising. Ather had raised Rs 900 crore in funding from two-wheeler major Hero MotoCorp and Singaporean sovereign wealth fund GIC in September last year.

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On Saturday, Ather launched a new range of scooters called Rizta, targeting the family market. The scooters, which start at Rs 1.09 lakhs, will be available in two models Rizta S and the Rizta Z. The vehicles will have a battery capacity of 2.9 kWH (kilowatt hours), with the most expensive variant of the Rizta Z coming with a 3.7 kWH battery.

The 2.9 kWh variants will deliver a predicted Indian driving conditions (IDC) range of 123 kilometres, while the 3.7 kWh vehicle will deliver 160 kms, the firm said.

The new scooter has larger, flatter seats and higher storage capacity to cater to usage by families. “We are launching the Rizta because we want our absolute (sale) numbers to go up… in my mind a lot of our competitors’ products are family scooters and our current 450 range does not compete there directly. But the Rizta is a much better fit from that perspective,” Mehta added.

Ather will target families, a market which sees about 3.5 to 4 million sales per year, about four times larger than the performance market scooter segment, chief business officer Ravneet S Phokela said during the Rizta’s launch.

The firm also announced the launch of its new technology stack called the Ather Stack 6 which entails improvements to safety and other usage features, as well as a new mobile app.

Ather also introduced two ‘smart helmets’ under the brand name ‘Halo,’ with a light-weight version called ‘Halo Bit.’ Halo is priced at Rs 12,999, and HaloBit at Rs 4,999.

Ather currently has a manufacturing capacity of 4.5 lakhs per annum, and is currently producing about 1.5 lakh vehicles, Phokela said, declining to provide a projection of how much capacity would be assigned to the Rizta. The firm also has a charging network of about 2,400 fast chargers and 210 service centres, he added.

At the same event, G20 Sherpa and former Niti Aayog chief executive Amitabh Kant said Indian EV makers needed to become the biggest manufacturers and exporters of EVs in the world.

“ICE (Internal Combustion Engines) are a dead technology according to me, and the market is getting disrupted by EVs. That is why players like Ather should not just make for India, but for the world, ” Kant said during the Rizta launch.

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