Electric two- and three-wheelers, charging infra and more: Hero MotoCorp’s EV gameplan explained

“Hero MotoCorp is committing 50 percent of its investments towards electric vehicles and going forward there will be more partnerships and collaborations on electric vehicle solutions," said Munjal.

On August 9, 2021, Hero MotoCorp celebrated its tenth anniversary. Exactly 10 years ago, on this day, brand Hero MotoCorp was formally launched after the Hero Group parted ways with its 28-year-old Japanese partner, Honda Motor Company. Today, Hero MotoCorp holds a 37 percent market share in India and is getting ready for the future -- a future that will depend on electric vehicles, premium motorcycles and exports.

Unlike its peers such as TVS and Bajaj, Hero MotoCorp has not launched its own electric vehicle but has been actively evaluating the market through electric two-wheeler manufacturer Ather Energy in which it has a 38 percent stake. Recently, Hero entered a partnership with Taiwan’s Gogoro on battery swapping and electric vehicles. With these partnerships, Hero MotoCorp is now getting ready to unleash its EV strategy.

Munjal explained that Harley Davidson was a key part of Hero’s premiumisation journey and the company would like to achieve at least 15 percent sales through exports by 2025.

Here are the top five takeaways from the Pawan Munjal interview:

Hero’s first electric vehicle will be an electric scooter, to be launched in the next six months. Pawan Munjal has indicated that this will be a mass market electric vehicle, fully developed by Hero MotoCorp. It will have a fixed battery as opposed to a swappable one.

Before the launch of the electric vehicle, Hero MotoCorp will put in place its own charging stations in select cities. The company would also be setting up battery swapping stations in collaborations with Gogoro. Eventually as the EV market grows, Hero MotoCorp plans to leverage charging networks of Ather and Gogoro, along with its own.

“Hero will be open to offering charging infrastructure to multiple players in future. Once volumes grow it makes imminent sense for many of us to pool investments and give comfort to consumers," said Munjal.

Pawan Munjal said that Hero MotoCorp has a range of EV products in the pipeline. The company’s startup Quark Motors has developed a modular electric three-wheeler which will be launched soon, though a date has not been announced. The company will also launch Gogoro’s electric vehicles in India but not in this fiscal. Reiterating that Hero’s 200 millionth vehicle may not be a two-wheeler, Munjal indicated that nothing is off the table for the future. Going forward, the company will be committing 50 percent of its investments towards electric vehicles.

Hero MotoCorp has said that it will launch 10 new products or come up with upgrades every year. Munjal confirmed that the company was also developing a flex fuel vehicle which could be launched in future as per market demand. He said that the partnership with Harley Davidson had been a great learning for Hero MotoCorp and the R&D teams of the two companies have been working together closely. When asked about the launch of a Hero-made Harley badged motorcycle, Munjal said that such a vehicle was definitely under works but will not be launched in this fiscal. Harley Davidson’s latest product, the Pan America 1250 was launched in India on Monday.

Going forward, Hero MotoCorp is well aware that the company cannot rely on India alone and will have to deliver strong export growth. Pawan Munjal said that the company was looking to achieve 15 percent sales through exports by 2025. “Focus now on global business is very big. Hero wants to re-focus on Nigeria and has entered new markets like Mexico," he said.

The industry veteran said that while so far Hero MotoCorp’s production and sales had not been impacted due to the semi-conductor shortage, the company was managing the production every week and month. Munjal said that the semi-conductor shortage may see an improvement in six months.

“Commodity prices have been very steep. We have not passed on full cost to consumers. Hero MotoCorp is taking a lot of cost efficiency measures to protect EBITDA and margins," he said.