The rising impact of carbon footprint and deterioration of air quality have been major concerns across the globe. The state and central governments have introduced various subsidies to reduce vehicle emissions. As sustainability goes mainstream, automobile companies are investing heavily in electric vehicles that are environmentally friendly. Multinational ride-sharing company Ola has recently launched  its ‘e-scooter’, and this would be a welcome move. Ola has strategised the right product, the right promotion – all at the right time. Digital access, big boot space, keyless, fast charging… all go into the right product, the Ola e-scooter! Tweet by tweet, Ola has generated excitement from ground zero till launch. Why will customers buy Ola e-scooter? How it is beneficial to the environment? Two variants, 10 colours, all contributing to the right promotional vibes! Its timing is also perfect – people have become more conscious about the environment during the pandemic.

But are these points enough? Ola’s long-term success will depend on numerous other factors such as the right price, the right supply chain configuration and formulating the right strategy to reach the target audience.

What’s the right price?

India is a price-sensitive market. The key challenge in front of Ola is to provide a new experience at an affordable cost. The majority of the two-wheeler population falls into the middle-income group segment. This segment of consumers primarily looks for a fair economical price while buying any new product. In 2021, two-wheelers sales reached  151.19 lakh units (IBEF, 2021). Scooters are available in India at a price range of INR 40,000 to INR 130,000. Ola S1 and S1 pro are priced at INR 99,999* and INR 129,999*, respectively. (*Prices may vary according to region and subsidies). The average price of a scooter today for the middle-class segment is between INR 50,000 and INR 70,000.

What’s the right Supply Chain Configuration?

The company must get its supply chain intricacies right as this important driver increases the cost. Ola is going to deliver directly to the customer. The direct model benefits Ola in the short run in reducing the advertising and overhead costs, eliminating dealership costs and working closely with consumers. Consumers also benefit from the closeness and individual care they receive from direct sales. On the manufacturing side, the direct model cuts out intermediaries, and they can follow lean inventory and save inventory costs. But the company should look holistically and balance inventory costs along with the transportation costs in the long run. Transportation costs (especially outbound costs) will be more in the direct model. Ola must learn from its previous experiences in this regard and focus on the after-sales service and support space. It’s easy to persuade the customers to buy, but the experience thereafter needs to be good too.

What’s the right strategy to reach the customers?

Understanding the mobility landscape and focusing on the right strategy to reach the target audience is one of the most important aspects of the business continuum.

The changing mobility landscape

The automobile industry is evolving fast and technology has brought a remarkable shift in manufacturing, assembling products, processes and the way we drive thanks to Industry 4.0 revolution – Internet of Things (IoT), Artificial Intelligence (AI), Machine Learning and Robotics applications. The technology revolution in the global automotive sector is known as the CASE (Connectivity, Autonomy, Shared mobility and Electrification) technologies (Deloitte, 2020). Staying relevant and up-to-date on contemporary technological innovations is key for the automobile industry.

With every passing day, new challenges and opportunities emerge.

1. Supply chain disruptions: The extended Covid-19 pandemic unequivocally affected the Indian automobile industry which was just surviving with a reverse gear in demand. During March-July 2021, the industry witnessed colossal interruptions due to semi-conductor chip shortages.

2. The transition from BSIV to BSVI emission norms: This is one of the pressing challenges that the automobile industry is facing. With changes in government regulations, it becomes difficult to sell old BSIV vehicles. This has led to a rise in the inventory of BSIV vehicles.

3. Non-Banking Finance Corporation (NBFC) Liquidity Crisis: NBFCs have been a major strength of the automobile industry as they are the key lenders for financing automobile purchases in semi-urban and remote villages where credit accessibility from the banks is normally difficult. NBFC’s liquidity crisis severely crushed many sectors, and the automobile industry is one of the major ones that it took a high toll on.

4. Urbanisation: Urbanisation poses another challenge for the automobile industry. Availability of other car rentals and non-availability of parking space in the metropolitan cities has made individuals defer their vehicle purchasing decisions.

5. Rising fuel cost: Change in GST-related tax structure, volatility in fuel prices, increased interest rates and insurance premium resulted in a steep sales drop of two-wheelers and four-wheelers. The Insurance Regulatory and Development Authority (IRDA) revised its insurance standards in September 2018, which resulted in increased insurance costs for two-wheelers and passenger vehicles (PV).

6. Growing demand for alternatives: Due to Covid-19, people may switch to personal mobility instead of shared mobility as a safety measure. Service-based models such as rental cars, pay-as-you-go models may kick-off.

Focus on the right positioning strategy

Arriving at the right positioning strategy involves recognising users’ distress areas and addressing them, in addition to providing them with key benefits.

Identifying the appropriate consumer segment is critical. Analysis of the current micro, macro-environment, market conditions, competition and economic swings is important, but the focus should be more on categorising consumers who have a high probability of purchasing e-vehicles. This entails understanding the consumer’s lifestyles, values, attitudes and buying behaviours. For instance, studying different generations provides a clear understanding of consumption behaviours during a particular period and how it differs across other age groups. It helps to appreciate how diverse formative habits, experiences and lifestyles relate to the ageing lifeycle. Usually, a generation refers to groups of people born over a span of 15 to 20 years, such as the Millennial generation. There is no definite start and end date for Millennials. Those who were born after 1980, i.e. between 1981 and 1996, are widely considered as Millennials (Pew Research Centre, 2019). The rise in the income level of Millennials and a higher variety of choices changed the mobility landscape. These particular segments dominate in terms of size as a result of a growing middle-upper class and a young populace. The evolution of the technology revolution also changed the way Millennials drive and their preference for mobility. Millennials are more conscious of being environmentally friendly; they prefer walking or using public transport due to affordability as compared to huge purchase and maintenance cost in owning a vehicle. Unlike the elder cohorts, many of the Millennials do not want to own a car; instead, they prefer scooters and shared mobility. (Deloitte,2019)

Recognising consumers’ distress points

Spotting the consumers’ pain points early will pave way for smooth penetration in the long term. For example, it takes two minutes to fill the fuel, but what about charging? Unlike conventional two-wheelers, consumers need to spend additional time for charging. Though consumers can charge in-home, Ola is also planning to put up hyper charging stations across the country to reduce the anxiety of riders.AI and customisable digital screens make consumers remain always connected, but there’s a flip side to it too. These digital screens and music apps will distract the riders during rides. Limited (two) variants, charging time, battery replacement cost anxiety and technical issues in sharing apps would also pose as shortcomings in the current options. Identifying consumers’ distress points with the current options may reveal opportunities on how to position the Ola e-scooters. Based on that, the company can create a tailored user content that will result in a greater possibility of converting them as brand evangelists for Ola e-scooters so that they will share their wonderful experiences with the public at large.

The Ola e-scooter is a potential disruptor in the mobility space. While there is a lot of excitement and eagerness to embrace the product, the organisation has to put in place a sound strategy in order for us to enjoy the ride!

References:

1. https://www.ibef.org/industry/india-automobiles.aspx assessed on 15^th August 2021

2.https://www2.deloitte.com/us/en/insights/industry/automotive/industry-4-0-future-of-automotive-industry.html

3.https://www.pewresearch.org/fact-tank/2019/01/17/where-millennials-end-and-generation-z-begins/

4.https://www2.deloitte.com/content/dam/Deloitte/au/Documents/consumer-industrial-products/deloitte-au-cip-global-automotive-consumer-study-2019-110221.pdf

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Hero MotoCorp, a leading two-wheeler manufacturer globally, has announced its official entry into the Republic of Italy. This expansion marks the company’s entry into its 49th international market.

Product distribution will be managed by Pelpi International, a large distributor that offers sales, service, and parts through a network of over 160 dealers. Initial distribution will focus on key cities with 36 dealers, with plans to expand to 54 touchpoints.

The three models available at launch are the Xpulse 200 4V, Xpulse 200 4V Pro and Hunk 440. Both models comply with E5+ and EU standards.

Hunk 440: This model enters the L3e−A2 performance category. Its engine delivers torque of 36.0 Nm at 4000 rpm and power of 27 BHP at 6000 rpm. It features dual-channel ABS with 320 mm front and 240 mm rear discs, USD Cartridge Forks by KYB, a full-digital TFT display and navigation. The Hunk 440 starts at EUR 3,990 (Incl. VAT) and is available in Twilight Blue and Phantom Black.

Xpulse 200 Family: The Xpulse 200 4V Pro has a 4-Valve head that produces 18.9 BHP and 17.35 Nm torque. It includes three ABS Modes (Road, Off-road, and Rally). It is equipped with a digital speedometer, inverted LCD Display, navigation, and LED Projector headlamps. The Xpulse 200 4V starts at EUR 2,990, and the Xpulse 200 4V Pro at EUR 3,190.

Hero MotoCorp will offer a standard 3-year warranty and an additional 2-year warranty as a launch offer, extending the total warranty to 5 years.

Sanjay Bhan, Executive Vice-President, Hero MotoCorp, said, "Entering Italy, the very heartland of two-wheeler culture, marks a defining milestone in Hero MotoCorp’s global expansion journey. We aim to redefine ‘The Future of Mobility’ at a global scale with next-gen smart mobility solutions that cater to diverse riding preferences. With products that reflect both the Explorer and Liberator spirit, we are inviting Italian riders to experience Limitless Freedom and Limitless Adventure every day. Our success in the Dakar Rally with Hero MotoSports is a testimony of our global engineering excellence and the innovation in products that we are bringing for Italy market."

Cesare Gali, Managing Director, Pelpi International, said, “We are proud to champion Hero MotoCorp’s entry into Italy. Their global scale, product quality, and the unparalleled commitment of a 5-year warranty give us immense confidence. The Hunk 440 and Xpulse 200 fill crucial, highly competitive segments in Italy, offering a unique blend of technology and value that will resonate deeply with Italian consumers.”

Pelpi International will make the brand available with 36 dealerships across key cities.

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Chennai-headquartered mid-size motorcycle major Royal Enfield has further expanded its online presence on e-commerce platform Amazon India. The company is making available its entire range of 350cc motorcycles on the e-commerce platform.

The partnership aims to offer convenience in the purchasing process, in addition to payment options available on the platform. The purchase option is currently open to customers in five cities: Ahmedabad, Chennai, Hyderabad, New Delhi and Pune.

The range of 350cc models available includes the Classic 350, Bullet 350, Hunter 350, Goan Classic 350 and the new Meteor 350. These will be sold through a dedicated Royal Enfield brand store on Amazon India.

Delivery and aftersales service will be handled by the customer’s chosen Royal Enfield dealership in the city. The brand page also allows customers to buy genuine motorcycle accessories (GMAs), riding gear and merchandise.

Royal Enfield 350cc motorcycles are now available on two e-commerce platforms, reaching ten cities in India. They are sold through Amazon.in in Ahmedabad, Chennai, Hyderabad, New Delhi and Pune, and via Flipkart.com in Bengaluru, Gurugram, Kolkata, Lucknow and Mumbai.

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Aprilia Racing has achieved global success with the limited-edition RSV4 X-GP, announcing that all 30 units sold out in just fourteen days following its introduction at the Catalunya Grand Prix.

The company stated that the immediate sell-out confirms the strong international appeal of Aprilia's ‘X’ brand, which the company states is a reference point for exclusivity, innovation and pure performance.

Enthusiasts from markets including Europe, the United Arab Emirates, Australia, Malaysia and the United States secured the bikes, with booking requests reportedly exceeding availability during the presentation weekend itself.

The RSV4 X-GP was created by the Noale Racing Department to mark the 10^th anniversary of the RS-GP's debut in MotoGP, featuring the official MotoGP Team livery. It is the most powerful RSV4 ever built, boasting 238 HP for a mere 165 kg of weight, creating an ‘unprecedented riding experience.’

The bike introduces several track-focused innovations derived directly from the RS-GP prototype, notably becoming the first factory derivative bike in the world to feature leg and tail wings – aerodynamic solutions previously exclusive to the MotoGP machine. It also includes a structural carbon seat support.

Massimo Rivola, CEO, Aprilia Racing, said, “X confirms its status for Aprilia Racing as an exclusive and niche brand with enormous potential. Aprilia Racing is synonymous with innovation and it fills us with pride to see that, even at a strategic and product level, we have created an iconic brand and a new type of absolutely exclusive bike, conceived specifically for track enthusiasts.”

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Suzuki Motorcycle India, the two-wheeler subsidiary of Suzuki Motor Corporation, Japan, has introduced new colour line-up for the Suzuki Gixxer SF and Gixxer motorcycles.

The fully faired Suzuki Gixxer SF priced at INR 137,231 (ex-showroom Delhi) gets two new colours - Metallic Oort Gray + Pearl Mira Red and Glass Sparkle Black + Metallic Oort Gray. The company is also providing exchange benefits up to INR 5,000 and extended warranty at INR 1,999 or insurance benefits up to INR 7,000 as part of the festive sales offer.

On the other hand, the Suzuki Gixxer priced at INR 126,421 (ex-showroom Delhi) gets three new colours - Metallic Oort Gray + Pearl Mira Red, Glass Sparkle Black + Metallic Oort Gray and Metallic Triton Blue + Glass Sparkle Black. The company is offering exchange benefits up to INR 5,000 along with an extended warranty at INR 1,999 or alternatively insurance benefits up to INR 6,000.

The Suzuki Gixxer SF and Gixxer are powered by a 155 cc, BS-VI OBD-2 B-compliant single-cylinder engine equipped with Suzuki Eco Performance (SEP), delivering 13.6 PS of power and 13.8 Nm of torque. This engine has a proven track record, having set a national endurance record in the 150cc category.

Both motorcycles feature European-inspired styling, highlighted by a LED headlamp and tail lamp, a sporty dual-muffler and split seats. The motorcycles also get a Bluetooth-enabled multi-function digital console with the Suzuki Ride Connect application. Key safety and performance features include single-channel ABS, wide radial tyres and a 7-step adjustable mono-shock for handling across varied conditions.

Deepak Mutreja, Vice-President – Sales and Marketing, Suzuki Motorcycle India, said, “The fresh colours of Gixxer SF and Gixxer underline Suzuki’s commitment to blending style, performance and innovation while catering to the aspirations of young Indian riders. With these enhancements, the motorcycles reflect Suzuki’s engineering and design philosophy, combining sporty character with comfort for both everyday city rides and long-distance touring. Along with attractive purchase benefits and easy ownership options, the updated line-up adds to the festive excitement and strengthens the connect of the GIXXER brand with customers across the country.”

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