Won't chase discount-driven volumes to boost growth: Ather Energy CEO
What's the story
Ather Energy, one of the leading names in the electric vehicle space, is gearing up to ramp up its lithium-ion cell manufacturing in India.
The company's CEO and co-founder Tarun Mehta disclosed the plan in an interview with Moneycontrol.
He said Ather won't chase 'discount-driven volumes' but rather focus on securing supply chains through expansion of domestic manufacturing.
Expansion plans
New facility to boost production capacity
Ather's proposed capacity expansion seeks to scale production from the current 4.2 lakh units/year to five lakh units.
The new manufacturing facility in Maharashtra will play a critical role in this plan, as it would focus on non-south markets with the growing demand for electric scooters.
Mehta stressed this facility would not just support higher capacity but also allow the introduction of a cost-effective scooter platform and help develop motorcycle platforms.
Market positioning
Strategy amid global tariff war
Speaking about the ongoing tariff tussle between the US and China, Mehta said India could stand to benefit from it.
He envisions Indian electric vehicle OEMs benefiting from a global supply surplus of lithium-ion cells.
"Long-term, we aim to shift more production, including motors and cells, to India," he said.
The company is already producing motors in India and moving toward rare earth magnet-free motors through partnerships like with Amara Raja.
Pricing strategy
Stance on discount-driven growth
Ather has decided to showcase pricing discipline on the basis of its software capabilities, unique safety features, and overall customer experience.
Mehta said that "discounting-driven growth in auto cannot last."
He emphasized that while discounts might inflate immediate sales numbers, they could also erode brand equity and compromise customer confidence in the long run.
Economic outlook
Ather's journey toward profitability
Mehta highlighted unit economics and volume growth as the two pillars of Ather's path to profitability.
He revealed that the company's engineering focus has resulted in a 31% price cut in the last three years, doubling gross margins from 9% to 19%.
Ather's dependence on government subsidies has also reduced drastically, from ₹55,000 to as low as ₹5,000 per unit.
The company plans further cost cuts with LFP batteries and a bigger integrated facility in Maharashtra.