15-04-2024 05:14 PM | Source: Reuters
India`s Ola Electric cuts cheapest e-scooter prices by as much as 12.5%

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Ola Electric, India's largest electric scooter maker, reduced the price of its cheapest variant by 12.5%, it said on Monday, as the loss-making company tries to boost sales after the government reduced subsidies.

Ola [OLAE.NS] cut the price of the cheapest variant of its S1X model to 69,999 rupees (about $839), from 79,999 rupees, said Anshul Khandelwal, the company's marketing chief. The prices of other S1X variants were cut between 5.6% and 9.1%.

The SoftBank Group-backed company launched the S1X scooters last August last year, just months after the government, in a surprise move, lowered the incentives to buy e-scooters. However, some analysts say the price cuts will hurt Ola.

"Ola is already selling its higher variants of the S1X range at a loss. Selling the base variant at a lower price is not feasible financially and this is not something they can do forever," said a Mumbai-based analyst, declining to be named as they are not authorised to speak to the media.

The Bengaluru-based company sold 326,443 e-scooters in fiscal 2024. While it beat its target of 300,000, it had lowered that estimate by two-thirds.

Ola's cheapest e-scooter costs less than the lowest-priced variants at TVS Motor and Hero MotoCorp-backed Ather, which cost above 100,000 rupees.

However, it costs less than Honda's Activa, India's top-selling petrol scooter, which retails at 78,000-82,000 rupees.

Ola, which started selling e-scooters in 2021, holds a 35% market share, while TVS and Ather control 19% and 12%, respectively of the market, as per government data.

India's e-scooter market accounted for 5% of total two-wheeler sales in fiscal 2024, according to industry data. ($1 = 83.4188 Indian rupees)