Exclusive: Taiwan’s Ahamani Group plots JV for entry into India's EV market

At a time when the world and digital headlines continue to be dominated by the word Covid and its overwhelming impact on people, places and profits, there are still a bunch of foresighted companies which refuse to be shaken from their chosen path of progress.
Their plans may be delayed but there's no stopping them from putting a foot or a wheel forward in their quest for market excellence. Taiwan's Ahamani Group is one of them. 
Last year, the Ahamani Group, a Taiwanese electric scooter maker with over two decades of experience in manufacturing e-scooters and components for EVs, had announced its plans to enter the nascent Indian e-mobility market. In June 2019, UrDa Mobility, a shared mobility platform backed by the Ahamani Group and one which began its operations in Taiwan in 2017 and now has over 37 UrDa charging stations in that country, announced plans to enter India. What’s more, in December 2019, Ahamani Group inked a JV with Gujarat-based battery maker Renon India to manufacture automotive battery packs for the domestic and global markets. The partners committed investment of $3.7 million (Rs 26 crore) in the JV to build customised battery packs, and set up a battery factory in Surat, Gujarat with an initial capacity of 200 MWh per annum, which can be further expanded to 1GWh over the next few years.

However, that was when the Covid-19 outbreak had just happened in Wuhan, China and was yet to assume even a fair portion of the huge dimensions it has now in mid-2020. Will the pandemic adversely impact the Ahamani Group or will it delay plans for make in India? “Though our production has been impacted followed by slow demand for electric vehicles, we still believe that the market will bounce back in Q3 or Q4 of CY2020 with higher demand. The pandemic has made consumers realise the need for sustainable mobility and we find an upward demand trend in other countries towards EVs,” says Chi. Tc Kung, CEO, Ahamani EV Technology. That's a sentiment even Naveen Munjal, MD, Hero Electric, India's largest EV maker, would second. 

Interestingly, India is the first Asian market where Ahamani will establish its presence outside of Taiwan. “The Indian automotive and mobility market is a growing sector with huge opportunities. The change in trend towards shared mobility is making it very interesting and opening up doors for foreign companies like us to better leverage the market with our proven technology. In the near term, we see the shared mobility market to quadruple in terms of traction and revenue,” says a bullish-on-India Kung. 

Key role for partnerships in Ahamani’s India plans
It is no secret that the India market is a tough one to crack for any organisation, as a fair number of global OEMs have learnt, much to their chagrin. Immensely value-conscious consumers, fast-changing buyer preferences and what seems to be some indifference to the EV cause when it comes to personal car buyers.
 

In a response as to why the company chose to enter India through a local partner, Kung says: “India is a large country and the market changes dynamically based on geography. To be successful in such markets, we need a local company with deep access (learning and presence) throughout the country to scale faster. We are in advanced stage talks with a potential partner to set up a joint venture in India for UrDa operations. We hope to begin operations by early 2021.” The company says it has earmarked around $1 million (Rs 8 crore) in “cash and kind” for UrDa to be operational in India.

At present, UrDa Mobility operates an electric scooter ride sharing platform, which lets users rent out the e-two-wheelers though an app that can be returned to any of its stations. This is an offering it aims to start operating in India. So, will Ahamani manufacture its e-scooters in India? No, the company says, citing that India is an extremely price-sensitive market from a retail point of view. In fact, at present, it does not have a near-term plan to manufacture e-scooters in India. Rather, it is looking to “offer technology licensing to local Indian companies to develop good quality e-scooters and the drivetrain components together. The case is similar to establishing the charging station network; we will not jump directly in to this but would rather work with a partner,” says Kung.
According to the Ahamani Group CEO, the company’s focus clearly remains on “manufacturing lithium battery packs with its JV partner and UrDa ride-sharing opportunities, which are quite well placed and are high growth verticals.”

Elaborating on its partnership with Renon India, Kung says the JV is in formation phase from the legal perspective. The plant is being set up and is likely to get commissioned this year. The JV will make LFP (lithium-iron-phosphate) battery packs for two- and three-wheeler EV companies. “Last December, we participated at the EV Expo, New Delhi and received a huge positive response. As a result, we have a few clients in the pipeline with whom we are working on developing specialised high-life battery packs,” reveals Kung.

Kung states that the plans for India operations are already progressing and in fact, for battery packs, the JV with Renon India has a few clients in advanced stage talks. And it is in advanced stage negotiations with a domestic market EV major for technology licensing. 

High-performance electric scooter in the future
While the Indian EV industry maybe at a nascent stage, it has not stopped different organisations, big and small, domestic and global, to try and compete for a share in what is said to be an upcoming market. In fact, the Indian electric two-wheeler industry sees one of the highest number of companies entering the market with their offerings. 

The EV industry in India reported total sales of 156,000 units in FY2020, up 20 percent year on year. FY2020 sales comprised 152,000 two-wheelers (97.43%), 3,400 cars (2.17%) and 600 buses (0.38%), compared to FY2019's 130,000 units comprising 126,000 two-wheelers, 3,600 cars and around 400 buses. Of the electric two-wheelers sold in FY2020, a majority or 97 percent of sales came from electric scooters, while the remaining 3 percent consisted of electric motorcycles and cycles. Of these two-wheelers, low-speed scooters (max speed 25kph), which do not need registration with the transport authorities, contributed 90 percent of the overall electric two-wheelers sales.

This is specifically the reason, Kung says, why the Ahamani Group decided not to get into the retail market on its own. “Our electric scooters are very heavy duty and compete with the likes of Ather Energy. This price (premium) segment market is not large at this moment, but I do believe that the market needs high-speed and heavy-duty electric scooters to be the alternative option for petrol scooters consumers soon in the future. We plan to introduce high-speed, torquey and heavy-duty electric scooters in the market together with our Indian partner in the future.”

According to Kung, Ahamani’s USP lies in the fact that it provides one of the highest standard battery packs which has proven to be long lasting and delivering optimum performance. The company’s e-scooters in Taiwan, Hong Kong, Japan and Europe have been running on these battery packs since the past 11 years without experiencing any trouble or degradation. Ahamani claims it offers a battery life of 5,000 cycles on its packs. “The market is going to driven by the RoI (return on investment) EVs provide to consumers compared to their (initial) cost. Our quality and price positioning will help us compete better in the market and drive better RoI, both for the OEMs and consumers,” explains Kung.
From the looks of it, the Ahamani Group seems to have a robust plan for its India operations, and is positive about achieving results. Interestingly, the company also has a“three-wheeler drivetrain technology and can work with Indian companies to develop products but there's no near-term plan yet in place,” says Kung. 

Interestingly it is not the only one. Another EV scooter and battery maker from Taiwan, JS Power is has recently announced an India market plan. So, clearly, the survival of the fittest on Indian soil is not only for the locals. The fight for the eco-friendly customer on two wheels in India just turned more interesting. Stay plugged in for more such stories.