VIDA Electric Mobility Coming From Hero MotoCorp
India’s largest two wheeler manufacturer, Hero MotoCorp Ltd, has finally announced its long-looked entry in Electric Vehicle sector from July this year under Vida Brand.
This New brand will helps Hero to caters the EV market’s need and will enable it to follow the planned mobility initiatives, including upcoming launches of electric two-wheelers.
The company is also planning to manufacture the vehicles in Chittoor, Andhra Pradesh, and will start delivering vehicles later in this year.
Earlier, Hero MotoCorp had announced that it will launch its first e-scooter in March 2022, but as per the recent announcement on 04 march, it confirmed that the launch has been delayed by about three months.
The statement severely affected the Mumbai market and lowered the company’s shares. The stock ended 4.32% lower on the NSE, widely underperforming a 1.5% fall in the benchmark Nifty index and a 3.5% drop in the Nifty Auto index.
The announcement of Hero MotoCorp’s came amidst an ongoing arbitration with rival Hero Electric over use of the ‘Hero’ brand name for its EVs.
Hero Electric is currently India’s largest manufacturer and seller which is owned by cousin and nephew (Vijay Munjal and Naveen Munjal) of Hero MotoCorp chairman and chief executive Pawan Munjal.
In October 2021, Hero Electric pleaded the Delhi high court to ban Hero MotoCorp from using the brand name ‘Hero’ for its upcoming electric two-wheelers. However the court did not grant an injunction that time asking both companies to solve the matter out of court.
People aware of the developments at the two companies directed that the launch of the new brand shall not be considered as end of the arbitration proceedings. The brand name ‘Vida’ was registered by Hero MotoCorp in November 2021.
Strongly favourable policies by the Government of India, improved ownership costs and a huge array of product availability has contributed so much in the growth of Indian Electric Vehicle Market. Rising Petrol prises and high buying costs of traditional two-wheelers are some another factors contributing. Consequently, legacy two-wheeler makers such as Hero MotoCorp, Bajaj Auto, and TVS Motor Corp. are forced to enter this segment.
Currently, the electric two-wheeler market is dominated by Ather Energy, which is owned more than a third by Hero MotoCorp, Ampere, Okinawa, and Ola Electric. As of 2021, the global market for electric two-wheelers was forecasted to grow by 130 percent to 233,971 vehicles, according to the Society of Manufacturers of Electric Vehicles (SMEV).
Hero MotoCorp and Gogoro announced a partnership last year to jointly develop an electric vehicle powered by Gogoro's swappable solution and form a joint venture to swap batteries in India. Vida will release its first electric scooter in July 2022, but it is unclear whether it will be a direct charging solution or a battery-swap solution.
In the first 11 months of this financial year through March, Hero MotoCorp's domestic sales fell by 16 percent to about 4.22 million vehicles.
“Among two-wheeler OEMs, TVS MotoCorp and Bajaj Auto have launched vehicles but are yet to ramp up production. Honda Motorcycle and Scooter India has announced it will launch an EV only next year", said Senior Vice President at Elara Capital, Jay Kale, adding that OEMs’ share of this market is likely to change rapidly based on their ability to ramp up capacities.
While unveiling the Vida brand at an event in Dubai, Pawan Munjal, Chief Executive Officer of Hero MotoCorp announced a USD 100 million global sustainability fund to establish global partnerships and spearheaded by the automaker and BML Munjal University. “Vida means life, and the brand’s sole purpose is to create a positive impact on the world and move us all forward in meaningful ways.This is truly the dawn of something special. In only 17 weeks from today, we will unveil our Vida platform, products and services to make the world a better place," Munjal added.
