The founder and MD of Okinawa feels the entry of Ola and expansion of Bajaj will help generate awareness about electric scooters in the country and grow the market.
Haryana-headquartered Okinawa Autotech, which has been selling electric scooters in India since 2016, has just launched its biggest advertising campaign. As far as the electric scooter market goes, only Hero Electric, the market leader, is ahead of Okinawa.
In its campaign, Okinawa addresses the issue of charging, load, speed and performance and maintenance. All the films highlight that Okinawa scooters can travel 100 km at just Rs 14. Jeetender Sharma, founder and MD of Okinawa, is of the view that the industry needs to educate people about the benefits of electric scooters. He says there is no question of competition, and he isn't worried about the SoftBank-backed Ola's entry into the electric scooter market.
Besides Ola and Hero, Bajaj and TVS are also making sizeable investments in the electric scooter business. All of them have a strong marketing budgets. "The more people advertise, the more units we will sell," says a confident Sharma.
Okinawa claims to have sold 4,467 units in April 2021, 5,649 units in May, and 5,860 units in June. Most of its customers reside in the southern states of Karnataka, Tamil Nadu and Andhra Pradesh, and also Maharashtra in the west. Okinawa electric scooters witness highest demand in cities like Bengaluru, Kanchipuram, Nellore and Pune.
What is the biggest challenge for electric scooters today? "Awareness," says Sharma. He says there are anxiety issues that need to be addressed and the benefits of electric scooters also need to be explained to people. In an interview with afaqs!, he talks about the electric scooter market, Okinawa's challenges...
Electric scooters tend to cause quite a bit of anxiety among customers. The office-goers in Mumbai, Pune and other metro cities travel 30-40 km daily and fear that the battery will get drained midway…
In 2015, we started our research in those markets where internal combustion engine (ICE) scooters were popular. We found that most electric scooters available in the market can travel 30-40 km per charge. When we launched our first scooter, it could travel 88 km per charge. Then, we moved it up to 150-200 km per charge.
In Pune, Mumbai and other metros, there is a lot of anxiety. But, at the same time, we also have a customer in Maharashtra, who travels 55 km to the office (one-way) and is happy with our product. The reason: the vehicle needs no or little charging per journey.
"Considering the size of our country, there are very few dealers, hoardings, news stories, television commercials on the subject of EV for people to understand its benefits,"Jeetender Sharma
Will more charging stations across the country, similar to fuel stations, address the anxiety issue?
Charging stations are good because they generate awareness. It is a concept that works well for three-wheelers and four-wheelers. As far as two-wheelers go, you can't expect someone riding one to wait under the sun or in the rain for an hour or two to get the vehicle charged.
In the case of Okinawa, we have a detachable lithium-ion battery. It can be charged anywhere – at a cafe, office or home. It is just like charging a mobile phone. So, in our ad we showcase how it can be charged at a roadside tea stall.
Do you think people will consider it to be as easy (and common) as charging a mobile phone?
Today, the most important aspect in the electric vehicle (EV) market is awareness. Why is it unable to capture a larger market share? It is simply because people don't understand the benefits of an EV. They are unaware of the good products that are available in the market.
Considering the size of our country, there are very few dealers, hoardings, news stories, television commercials on the subject of EV for people to understand. It will take collective efforts on the part of the government, OEMs and all the stakeholders involved to generate awareness in order to address the anxiety, and also boost EV sales.
Talking about awareness, service centres and the availability of spare parts are the driving factors, when it comes to automobile sales. Are there enough service centres for EVs?
We have made it mandatory for our dealers to provide service at the point of sale. If you want to be an Okinawa dealer, you will have to set up the sales, spare parts division, as well as a service station. Only then will you be able to get a dealership. Like ICE scooters, sales, service and spare parts are also critical for electric scooters.
Where are you selling your scooters today? Who is buying them?
The demand is high in the top (metro) cities. But at the same time, our products are doing well in the Northeast too, Nagaland, Manipur and Guwahati (Assam), where there is little awareness about EVs. Simply put, EVs will become popular where ICE scooters are already popular. The South and West are the biggest markets for ICE scooters, and that is the case for EVs too.
What is triggering the purchase decision?
We must remember that the value of Rs 100 is far more for people living in rural areas, and that is what is triggering electric scooter sales in those markets. Urban pockets have more educated customers and so, what brings them to a showroom selling electric scooters are environmental factors.
You say that EV is economically beneficial, but the customers need to change the battery every three years. So, while they save on fuel, they have to spend a big sum once every three years...
Our batteries last around 3-4 years and there is a lot of innovation going on at the laboratory to improve the life of cells. However, what people don't understand is that even with the current battery life, an EV is economically beneficial. People can easily buy a new vehicle with the amount they spend on fuel (petrol, etc.) and maintenance of ICE scooters in three years.
ICE scooters have been sold as a family product over the years. Just take a look at 'Humara Bajaj', the iconic campaign. Electric scooters, on the other hand, are seen as a 'solo use' product…
Ours is a family brand. The family can travel together. Also, the purchase decision is made by the family. You will find all our products ensuring a family's safety in their communication. Why only 'Humara Bajaj', there is 'Desh Ka EV - Okinawa' too. All the brands will have their own identity. We are not worried about the entry of bigger brands with larger marketing budgets. It is good for us, our sales and the industry.
Ola is entering the market and the registration numbers are all over the news. You have Bajaj investing in EV and Hero is already there. What does this competition mean for Okinawa?
There is no question of competition at this stage. As more companies enter the market, more awareness will be generated. At the end of the day, better products, in terms of quality and value propositions, will remain in the market. The entry of Ola and other large brands will only benefit the industry. The ICE scooter market size is around 20 million and electric scooter is just one per cent of it. We will sell more units as more players enter the market.
What will be the electric scooter-ICE scooter ratio in five years' time?
In my opinion, five years from now, electric scooters will be 20 per cent of the ICE scooter market. The overall market in 2025 will be around 26 million scooters, of which five million will be electric scooters.