Pawan Munjal, chairman of Hero MotoCorp is ready to play the startup game by getting into the Cash burn subsidy model for public if necessary as it wants to utilise it;s investments worth thousands of crores while also being open for new investments.
This step has been taken by the company due to Ola electric giving them a big challenge in the Electric vehicle market as Ola have claimed to have garnered around 1 lakh bookings in the first day itself.
“In case the market is disrupted in a manner that we are required to do that (engage in cash-burn) to get into the market with pricing where we have to become aggressive and get a fair share, then we will do it,” Munjal said.
“We will move to 100 per cent product recyclability along with carbon neutral dealerships by 2030. We will have 10 or more partnerships creating a more sustainable India. We will launch EV's in 20 global markets and 15 percent of our total volumes will come from our global sales by 2025,”
Hero did devote a lot of airtime to EVs during their 10th Hero brand celebration. We had Tarun Mehta and Horace Luke talk as part of the show. And yes, we did have a glimpse of their un-named electric scooter. Seemed to have been a German design - probably with the Munich tech center working on that. Kind of thought that the legroom was on the lower side.
Pawan Munjal is saying a lot of things right, but the proof of the pudding is in the eating. Till the time we do not see their vehicles on the roads, we will wait and watch. Market leadership chrome to Hero because of Honda’s technical prowess with engines. The CD 100 and then the Splendor were vehicles with a very affordable total cost of ownership. Hero needs to repeat the same with electric vehicles. Although the question is not so much TCO but getting the power-range-price equation right. They need to come up with a scooter which can deliver 150 km range, a 2 kW motor and a price close to 1 lakh. If they can do that, then they are home.
Do they need to really burn a lot of cash for that. Don’t think so. The real problem is not cash, it’s DNA. Can they get the petrol that runs in their veins replaced by electrons in their nerves? If the company mindset does not change, the company will go the way of the dinosaurs. Bill Gates pivoted his whole company around the Internet Explorer to survive. Pawan Munjal needs to borrow a page from Rajeev Bajaj’s book. Rajeev ditched the best selling legacy scooters of his dad’s time to get the company to focus on motorcycles. Pawan ji needs to do something similar to show his company and the world at large, that he is serious about electric.
And thankfully so. Virtual worlds need no vehicles. You only travel on real roads. And the best way to experience a car is in 3 dimensions - and we are not talking virtual reality here. Way to go, Geneva Motor Show! And PII leads - as we organise our first post pandemic community get together at Pune on independence day. Jai Hind!