Ola Electric's e-bike pricing sparks debate across EV industry

The launch of a range of electric motorbikes (e-bikes) by Bengaluru-based Ola Electric, a first for the company, has disconcerted the industry because the low price the firm claims to be offering has the potential to disrupt the market.

On August 15, Ola unveiled its Roadster series e-bike with a starting-price at Rs 74,999.

This new pricing undercuts the previous lowest price in the category, which was Rs 110,000.

This pricing strategy has sparked debate in the industry, with many insiders viewing Ola’s approach as more a marketing tactic than a sustainable business model.

“This is a market-luring statement at this point. The real test is building and delivering a product at that price,” said Jaibir Siwach, founder and chief executive officer, Kabira Mobility, a Goa-based motorbike maker.

Siwach added the numbers did not add up because the battery pack and drivetrain usually accounted for about 70 per cent of an electric vehicle’s cost.

“A high-quality battery pack costs about Rs14,000 per kWh. For a 4.5 kWh battery, that’s Rs63,000 alone, and additional components push the total beyond Rs1 lakh,” he noted.

Kabira Mobility and other major motorbike manufacturers offer their products in the price range of Rs 110,000 to Rs 399,000.

Even the highest-priced Roadster Pro, at Rs2,49,999, is well below the industry’s upper price range.

Leveraging experience

This isn’t the first time Ola is leveraging price to its advantage in a highly price-sensitive automobile market.

Last year, the company launched its entry-level e-scooter, the S1X, at an introductory price of Rs79,999, intensifying its challenge to conventional engine counterparts.

The S1X brought price parity between electric scooters and their internal combustion engine (ICE) equivalents, which were typically priced around Rs 80,000, compared to most e-scooters that were selling for well over Rs 100,000.

This pricing strategy propelled the company to market leadership in the segment.

Competitive landscape

E-motorbike players, however, say selling e-scooters and e-bikes is like comparing apples and oranges.

Motorbikes are often viewed as lifestyle products, especially among younger consumers who want quality products at competitive prices.

Ola might find it challenging to deliver on both counts, they say.

One of the leading players in the segment said Ola would sell at a loss, adding that the introductory price could always be increased later.

Ola initially priced its S1X e-scooter with a 2 kWh battery at Rs 79,999 for the first week, but the price was later raised to Rs 89,999.

The BikeDekho.com data shows that of around 200 players in the e2W market, about 40 are in the e-motorbike segment.

Of these, only a few focus solely on e-motorbikes.

Revolt currently leads the segment with 4,893 units sold as of August 15, according to the Vahan data.

“Ola’s entry will expand the overall e-motorcycle market.

"With our commitment to quality, the ongoing decline in battery prices, and our planned entry into the commuter bike segment, which represents 8 million motorcycles or 65 per cent of the total two-wheelers sold in India, we have a clear advantage.

"Right now, we are focused solely on the performance motorcycle segment,” said Anjali Rattan, chairperson, Revolt Motors.

Riding the wave

Ola’s foray into the motorbike segment aims to capture a larger share of the 2W market, where motorbikes hold a significant lead.

Despite this strategic move, sector experts caution that the sustainability of e-motorbikes remains uncertain, even with non-lithium batteries.

“Pricing Ola’s Roadster seems like a predatory strategy.

"It’s unlikely to be sustainable for selling electric motorcycles.

"Ola appears focused on capturing market share before conventional players, such as Royal Enfield, enter the e-motorcycle market in 2025,” said Preetesh Singh, a specialist in CASE and alternate powertrains at NRI Consulting & Solutions.

While experts acknowledge that Ola benefits from being the only major e2W manufacturer included in the Centre’s ambitious Production-Linked Incentive (PLI) schemes for advanced chemistry cells and automobile and auto components, it must achieve commercial-scale production of these components to ensure business viability.

“Ola, as a startup with substantial post-initial public offering cash reserves, low borrowing costs, and access to green funding, is poised to disrupt the market,” said Puneet Gupta, director, S&P Global Mobility.