A new electric bike is in the pipeline from Hero electric ; welcome indeed in these days of increasing petroleum prices and concerns for the environment

Two wheeler scion Naveen Munjal wears many hats, the most important one being managing director of Hero Electric. Besides, he is also the chief executive of Hero Exports, the deputy chief executive of the Hero group's call center company- Hero ITES and Hero Cycles the largest manufacturer of cycles in the world. Excerpts from the Interaction with Naveen Munjal...

Why did Hero not enter the Electric Vehicle (EV)  market before?

Electric Vehicles are relatively new in India and the entire segment is still in a very nascent stage in terms of their technology. Hero Electric has been studying and researching the global electric vehicle market for the past 12 years. Now there is a felt need for such products and Hero Electric took the plunge in 2007 to enter into the EV segment.

How will you differentiate your electric vehicle from the competition?

Hero is a household name; trusted and credible. The advantage Hero has over other players is that it understands two-wheelers like no one else. We have invested heavily to develop the category unlike other fly-by-night operators who get containers from China and assemble the bikes.........This is a segment where providing the latest & best technology is most crucial to the success of the product. Hero Electric has undertaken large investment in R&D to set up research facilities in Ludhiana and Delhi with a high level research team. We also have a manufacturing facility that can make 440 electric vehicles per day on a two-shift basis giving it an annual capacity of 125,000 units.

Why do you think EV is not catching on fast in India?

The Electric Vehicle (EV) is a fruit of scientific research that is being reconsidered by the auto industry as a prudent option to ensure an environment free of pollution.

The reason why electric vehicles are not catching up fast in India are due to several factors: awareness about the category in totality, lack of charging stations, limited speed options and finally the exorbitant cost that such vehicles entail due to complexity of their design. Other problems include less availability of spare parts and qualified mechanics, bad dealer network, even though it is claimed maintenance free, problems with electrical kits often occur.

However, with development happening in this area and with spiraling fuel costs, it's certainly not an illusion for Indian consumers to own electric vehicles.

What do you think needs to be done by the industry or the government to make EV's more popular and acceptable in India?

We need to create awareness about the entire category. As of now there is complete ignorance about the benefits and the user-friendliness of the products. There are some limitations of using an electric vehicle; like batteries, charging time, speed etc, however we are in the process of finding out solutions to counter these obstacles. Lot of governments have offered subsides to make the vehicle more acceptable amongst the consumers. Recently, the Delhi government has announced a 15 per cent subsidy on the base price of the electric vehicle (EV) and a 12.5 per cent exemption of VAT, to mitigate the rising fuel prices and to promote eco-friendly, non-polluting means of transport, ahead of the commonwealth games. In the past Chandigarh and Bangalore had also offered subsidies on the electric vehicles.

Could you run us through the evolvement of the EV industry in India and globally?

Electric vehicles have existed since before the turn of the last century and initially out-performed those vehicles being powered by gasoline. However there was a rapid growth in the gasoline powered vehicles and they started becoming more and more efficient and cost effective. EV technology on the other hand remained in the nascent stage till 90s when the fuel prices began to rise. China became the first country to seriously look at the EVs as a viable alternative to gasoline driven vehicles. The market for motorcycles in China, presently at 30 million is projected to increase at an annual rate of 13.9 percent, reaching 44.4 million units by 2011. Strong growth in the Chinese motorcycle market will be primarily driven by rapidly increasing sales of electric motorcycles, which are significantly cheaper than gas motorcycles and subject to lower levels of government regulation, making them popular choices among urban consumers as an upgrade to traditional bicycles.

There is a great interest in European and North American markets where the governments are encouraging the use of EV two wheelers, besides their application in Police, Courier companies and for personal use.

In India there are more than 40 companies into EV two wheelers but less than 5 serious players. EV penetration at present is very low and the customer has started buying it to save on running cost.

Could you describe in brief the various stages involved at your plant?

We are pursuing a definite plan of indigenization starting with the Chassis and steel parts and going on to proprietary items. The press shop, sheet metal shop, paint-shop and assembly lines are in place to manufacture local components and assemble, test and dispatch the final product. The latest import duty structure does not favour localisation as the duty for fully imported electric 2 wheelers is 14% less than the parts imported for 2 wheelers.

Where do you see the automobile industry heading, as also the EV industry in India and globally?

As India's transport network is developing at a fast pace, Indian Automobile Industry is growing too. The reason behind the immense growth of the India Car Industry can be attributed to the availability of car loans, affordable rates of interest, smooth repayment facilities and the deductions offered to the customers by the retailers.

The constant changes in the existing car models with regard to design, innovation, technology, and colors, have led to a fiercely competitive market. Now that technology and innovation are not alien concepts for Indian car makers, Indian cars are becoming increasingly sleek, stylish, and luxurious.

Advances are being made though that can in the near future make electric vehicles much more practical.

It has an electronic start and accelerator with no gears, no engine, no belt or chain drive, zero emission and no pollution.

What is your management style?

I am very careful while hiring the people and once on board, I give my senior team complete empowerment. Besides giving a broad direction and setting Key goals, I am a truly hands off person.

How do you go about getting things done, translating your vision into reality?

I keep my ears and eyes open when meeting people and visiting places to spot any opportunity that has a potential synergy with our line of business. I try to foresee the business requirements much ahead of time and sow seeds in time.

How do you inspire your team?

I believe the greatest satisfaction comes out of richness of the assignments handled  and the feeling that one is doing a worthwhile job. I therefore try to ensure that the teams have a  quality job at hand and they go back home each day feeling they have done something good, innovative and contributed towards the organizational progress.  

Tarachand Wanvari who heads the  South Indian Bureau of www.indiantelevision.com is a consultant correspondent for Business Gyan and www.businessgyan.com. Reach him at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

Issue BG89 Aug 08

Related Items:

---

Be first to comment this article

Only registered users can write comments.
Please login or register.