He pointed, “Today the startups don’t have transparency on how to carry forward their business for the next 9-12 months, so they think it’s better to fold down.”
At the same time, Gill mentioned that startups also have a positive side to look at. They are agile and lean which enables them to react faster to a situation and also because they have already adopted digitalisation. Their business model is based on innovation and there is no dearth of ideas.
The SMEV head expects EV demand to be tepid in the first three months, but it will pick up in the latter half of the year.“The first six months of this year will give only 15-20 percent of the annual volume but having said that in the last six months, we are going to recover what we have lost. On an annual basis, we will not lose because the run rate will become double in the last few months especially for personal vehicles, entry-level segment cars and two-wheelers”, noted Gill.
However, he thinks the demand for the e-rickshaws is going to be slightly slower because of the lack of financing resources and people moving away from the shared mobility concept The electric taxi segment will also witness a reduction in the demand, as per Gill.
While industry experts believe that the coronavirus outbreak will act as a boon for the segment resulting in faster and wider adoption of EVs, the Hero Electric CEO has somewhat mixed opinions.
According to him, one way of looking is that the Work From Home (WFH) culture might lead to less ownership of vehicles across segments whether ICE or EV. Secondly, while moving away from public transport, consumers would be looking at an affordable substitute of personal mobility.
But there is a third angle where people are becoming more considerate towards a better environment which might have an impact on their vehicle purchase decisions.
Gill revealed that Hero Electric got historically high enquiries via online retail which gives him a fresh lease of life during Covid-19 and he expects good demand for electric two-wheelers in the near term.
As for electric cars, he quipped, “ Electric car purchases are more on the premium side and not so much on the entry side. In the extreme short term, the outlook might not be strong but in the long term lots of things are going to change.”
Commenting on the PM Modi clarion call for Go Local in the perspective of EV space which is highly dependent on Chinese imports, Gill said, “Economically on the industrial front, India will literally have to build a great wall of China on the eastern border to stop them from entering!”
Gill opined that India has already missed the bus and a definite plan is needed otherwise there will be a total collapse of the system. The country has to take quick steps to create barriers by increasing duties and simultaneously promote local manufacturing.