Wednesday, April 3, 2013

Mahindra Reva aims to sell 5,000 cars in first year

Mahindra Reva Electric Vehicles Pvt Ltd (MREV), which launched its new electric car, e2o in Bangalore today, has set an ambitious sales target of 5,000 units in the first year of its launch, a growth of 10 times compared to previous years. The company has till now launched the car in Delhi and Bangalore. It will be launched in six other cities over the next few days, a top company official said.

"We could sell around 500 cars per year with our previous model REVAi. With e2o hitting the roads, we will be happy if we can sell 400 plus cars a month. We will soon launch it in Ahmedabad, Chandigarh, Kochi, Mumbai and Pune," Chetan Maini, chief of strategy & technology, MREV told Business Standard.

The company hopes to drive sales of the new model in cities like Delhi and Mumbai where there are incentives available for the customers. The government of Delhi provides about 15% subsidy on the ex-showroom price of the car, while in Maharashtra, there is no road tax and only 5% VAT is charged, Maini said.

MREV is also banking on other states like Chhattisgarh and Rajasthan, which have exempt electric vehicles from paying road tax and VAT. The company is also in talks with several other state governments like Karnataka and Kerala for extending similar concessions like in Delhi.

"We have written to the government of Karnataka three weeks ago seeking similar concessions like in Delhi. After Delhi, Bangalore sells more number of cars. There is a reasonable amount of paralysis and change in last six to eight months in decision making. We hope something happens in Karnataka too in the coming days," Maini said.

Presently, the government of Karnataka charges 5% value added tax and 4.4% road tax. There was no VAT and no road tax for five years in the state earlier. The taxation structure for electric cars has gone up by 10% in Bangalore recently, he said.

MREV is currently appointed 24 dealers out of 200 plus dealerships of Mahindra Group to sell e2o. "We will slowly expand the network and by end of this year, we will further expand the network depending on the response from the customers in the first three months of the launch," Maini said.

The company plans to enter the export market in 2014. "We will focus on exports only in the next calendar year. We have lots of enquiries from various countries. There is a lot of change in the electric vehicle policy globally. We have to study those policies in several countries before launching the new model," he added.

Maini said the company would also phase out the earlier model, REVAi and offer a buyback arrangement for existing customers to exchange their old car with the new model.

MREV launched e2o at Rs 7,01,045 (on-road) in Bangalore. The price of the e2o will vary in different states, depending on the subsidies provided by the respective governments.

"We delayed the launch of our new model thinking that the government of India would announce the new incentive scheme as outlined under the National Electric Mobility Mission Plan. But, there is no announcement from the government still and we have gone ahead with the launch and trying to convince state governments to offer subsidy at their level," Maini added.




kushank Singhal
PGDM 2nd

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