India Scooter Startup to Invest Up to $330 Million in New Plants
(Bloomberg) -- India’s Simple Energy plans to invest as much as 25 billion rupees ($330 million) in new capacity to make electric scooters, with support from the government in the southern state of Tamil Nadu.
The Bangalore-based company is constructing an initial facility an hour outside the city with the goal of starting operations in 2022 and the capacity to produce a million electric two-wheelers a year. It aims to open a second, larger plant in Dharmapuri in 2023, with capacity to make 12.5 million of such scooters annually.
The startup has raised $21 million so far and expects to close another round of funding in the “three digit millions,” said Suhas Rajkumar, the company’s chief executive officer.
“We founded the company with the goal of doing everything in house, including the battery pack and the motor, at a time when 99% of the EV manufacturing is dominated by China,” the 25-year-old, who is also co-founder, said over a video call. “We want to follow in the footsteps of Tesla and Rivian who do everything themselves and do it right.”
Simple Energy plans to buy 600 acres for the new facility, complete with an R&D center and testing facility.
The electric scooter market is competitive in India -- and treacherous. Ola Electric Mobility Pvt, a local rival, already went public with plans for the world’s largest electric scooter factory, making 10 million vehicles annually by 2022. But the company this month said it would delay shipments because of the global chip shortage.
Simple Energy claims that its flagship Simple One scooter, launched in August, has the longest range in the country. It also aims to customize models for overseas markets.
“We are building three different variants of the scooter including an affordable and premium versions to target global markets like Southeast Asia, European Union and Australia where demand is high,” Rajkumar said.
He added that chip shortages are creating some challenges. But the company signed agreements with Texas Instruments Inc., Renesas Electronics Corp. and two other chipmakers to lock up as much supply as possible, the CEO said.
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