Better to miss the bus than boarding a wrong one!

The mobility electrification story is true, here to stay, and the factors aiding its growth across the globe are well known. Let’s focus on the India chapter here. On one side there are a plethora of start-ups trying to cater to a wide spectrum of aspects of this evolving #EV ecosystem, be it the vehicle itself, battery, services - energy as a service / mobility as a service, charging infrastructure, aggregation, or ancillaries such as financing & insurance, and on the other side are legacy automotive players aka ‘OEMs’. While large #OEMs capture over 95% of market share by value (market being small), they do struggle with the existential question of cannibalizing their own ICE (Internal Combustion Engine) business which they are so heavily invested in over the years. Point being that given the inherent conflict of interest, we may not see real innovation coming from this part of the play anytime soon, particularly in the affordable segment.

In any evolving sector, being an early mover could be vital but what is extremely crucial is to focus on #innovation, which comes through robust R&D. So where is the innovation? Having closely followed and evaluated multiple companies in this space over last couple of years, that is one of questions I always ask.

In the context of electric mobility, there are many aspects which have a huge scope for R&D, innovation and disruption. Take for instance, battery - chemistry / cells (given our huge reliance on imported cells and issues related to sourcing of Lithium, Cadmium and then dumping), packaging (making battery packs more compact, safe & customisable), swapping (pragmatic solutions for reducing downtime but efficiently), enhanced cycle-time; creating energy efficient power trains, retrofitting of existing ICE vehicles (with hybrid or dual powertrains for a smarter transition, overcoming range anxiety); use of advanced material for creating light weight chassis (yielding better range and payload); smart motor and controller, advanced VCUs, a robust and cost effective #BMS (so that OEMs can use one to ensure safety of the vehicle), telematics / software / data analytics for ease of use, tracking, safety, feedback… the list is long.

If you are catering / contemplating catering to one of these innovative aspects, trying to create value for the ecosystem and yourself, KUDOS & way to go! However, if you are trying to be a ‘me-too’, racing into the vehicle manufacturing play (predominantly 2 & 3 wheelers) by simply sourcing #CKDs/ components and assembling to get the product out quickly, there is a strong chance you might be missing the woods for the trees! First, being an OEM is no child’s play (not a dampener but a reality check.), despite having proven technologies in place, it has taken large OEMs decades over decades to create a trusted brand and loyal customer base. And second, how sustainable is your business model going to be? With a susceptible supply chain, consumer uncertainty on the need to switch to EVs - exacerbated by certain untoward incidents lately, inadequate infrastructure, lack of post sale service & trained personnel, what scales can one really achieve? I understand, the total cost of ownership (#TCO) concept makes immediate economic sense to gig workers and fleet operators, but even they prefer high quality and sturdy products as the entire concept of TCO is built on a reduced running cost rather than upfront.

It’s therefore extremely important to ask what are we really trying to achieve or solve? It is imperative to have a #futuristic vision, instead of trying to reduce cost alone, focus should be on enhancing quality, getting the product right thereby gaining consumer confidence.

Instead of thinking of what sells today, create a product which has the potential of disrupting the market by replacing age-old models with new age mobility. There is a good case to pause and think strategically about the long-term goals. Isn't it better to miss the bus rather than boarding the wrong one? And with the current penetration of EVs being less than 1%, trust me, the bus is far from being missed. There’s a huge scope of innovation in this gradually evolving and expanding market.

At this stage it’s not easy to tell right from wrong, what would be rewarded and who would go belly-up, but there are always analogies to draw and examples to learn from. Let’s try not to walk down China’s path where while EV adoption happened at an unprecedented pace but to what end… inter-alia, turning into a wasteland of used scooters lying in cities with no end-use in sight.

Let’s also try to address some profound issues such as the energy problem by creating energy efficient solutions; reduce dependence on imported cells (~100% is imported at present) by leveraging the rich academia and scientist community of the country working on relevant subjects such as better battery chemistry, energy density using sodium, zinc-manganese oxide, nano-tubes or cleaner sources of energy such as hydrogen, renewables, or materials like graphene which can improve the cycle life significantly; try to improve shared mobility and public transport by making it not only more accessible but also attractive - which could potentially reduce urban traffic to a large extent; there is a need for managing the country's energy distribution & transmission system better as we transit to electric mobility; think of fair sourcing, recyclability, circular economy, end of life use, study the holistic environmental impact that EVs could have, rather than scope 3 emissions alone, think of products and solutions which can change the way we think #MOBILITY today!

PS: Posted as food for thought for prospective #startups #enterpreneurs in the Electric mobility space!

Happy to hear contrasting views / thoughts!!

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