Tesla's patents and a new approach could re-charge a sputtering Reva
India's Reva sells more electric cars abroad than it does at home and it may yet be some ways away from wooing the average Indian. But if it gets its strategy right, it may end up selling quite a few cars at home, if not globally.
Can Elon Musk's decision to allow unfettered access to Tesla's patents signal a new dawn for Reva, India's electric stalwart? The car maker that around a year ago was bought up by car, motorcycle and tractor manufacturer Mahindra said recently that it would review Tesla's patents for applicability to its product range, but truth of the matter is that it would take more than a Tesla patent to bring life to the electric auto industry in India.
Yet it has sold a measley 500 cars in about a year. One problem is the lack of subsidies which the government had promised to offer under the National Electric Mobility Mission Plan, but haven't as yet. The second is the cost—the cheapest e2o costs around Rs 656,000 (or US$10,900 at today's exchange rate over a five year period), or roughly Rs 500,000 (US$ 8,333) up front plus Rs 2,599 (US$50) per month for five years in battery maintenance costs which a lot of middle class folk consider pricy at a first glance.
However, some back-of-the-envelope math shows that the Reva is not at all a bad deal when compared to a petrol auto in a similar class. A fully loaded LX model of the Maruti Suzuki Wagon R which is roughly comparable costs Rs 434,000 (US$7,233) and if you factor gas expenses of around 60 kilometres a day which is what the average family or commuter in Delhi racks up (minus weekends where you would average less), at around 18 km per litre, you would shell out on average around Rs 5,500 (US$91) per month.
This brings your annual total to Rs 66,000 or US$1100 (the Reva's operating costs, on electricity at Rs 5 per unit is negligible) and in five years, you would have spent approximately Rs 330,000 (US$5,500) which is at least Rs 1 lakh (US$1,666) more than the Reva sans any kind of subsidy. This is not even factoring that the e2o is designed to be used as a battery-inverter to power the entire house during power failures (not uncommon to India) or the minimal wear and tear on the e2o's parts considering there’s considerably less machinery moving around inside than a regular car. (Of course, five years with the e2o will signal a whole new set of batteries, but the old set now can be bunged into the house as your familiar friend, the inverter)
So pretty good deal huh, especially for a cost conscious Indian who isn't bothered about going faster than 80 km per hour which is the Reva's top speed? Problem is, most Indians—or people anywhere in the world, really—are afflicted with range anxiety and considering the paltry number of charging points in Indian cities to power up the e2o, juicing up is always going to be an issue. And since Reva hasn't really mounted a campaign to win over the Indian consumer, not many are likely to opt for it over its petrol and diesel cousins.
So what could the Reva do to pump up its anemic numbers? I think that Reva has missed a trick or two from Tesla’s climb to electric—no, make that auto—supremacy. When I last wrote about electric cars, Tesla's Model S costing US$80,000 sold more cars (4,750 units) than not just the $40,000 Chevy Volt (4,421 units), and the $30,000 Nissan Leaf (3,695 units), but it was in fact the most-selling luxury sedan for that quarter, outstripping the Mercedes S Class which was far behind (3,077).
The reason why most people like Tesla is not because of just its eco creds. It's because the monster that is the 362 bhp Model S is possibly the sexiest and fastest car around for your pocketbook that just happens to be electric and can reportedly out-drag a 1,200 bhp Bugatti Veyron thanks to the immense, flat torque curve at zero rpm that an electric motor can produce. And you're not going to run out of juice anytime soon thanks to its 426 km range courtesy of its lithium ion batteries ingeniously embedded into the floor of the car and a marvel of structural engineering.
This is something I brought up when last chatting with Chetan Maini, the founder and CEO of Reva—the fact that Reva will attract a lot more admirers, especially in India where bigger and faster seems to gain more traction than smaller and slower. To which Maini said "From a brand perspective, it's easier to go from the top to the bottom, but from a cost perspective easier to go bottom to top."
Well, it seems as if Reva has begun to look at a pricier and more marquis option more seriously. It is apparently looking to commercialize its seriously stylish electric sports model 'Halo' (thanks to Pininfarina and Bertone who helped design it) which can touch a speed of 0-100 kmph in less than 8 seconds and has a top speed of 160 kmph with a range of 200 km on full recharge. However, a tentative sticker price of 30-35 lakhs, or 3-3.5 million rupees (approximately US$48,000 to US$56,000) may not be the most appropriate price tag to lure the prospective well-heeled Indian customer who would rather spend that on a mid-range petrol sucking Audi. Also, looking to hit retail shelves soon are electric versions of Mahindra’s Verito sedan and light commercial vehicle Maxximo which may turn out to be promising bets depending on their vital statistics.
If Reva can, after appropriating Tesla's patents many of which have shown remarkable advances in battery technology and structural design, effect even a 10-20 percent increase in efficiency in either range or price, it could bring about a much-needed push to the brand among Indians who may be environmentally conscious and looking for a change but unable to embrace it because of the price factor.
Still, for electric vehicles like Reva to truly succeed in India, you need infrastructure and lots of it. For instance, Tesla has ensured that the US houses plenty of its supercharging stations strewn about the countryside so that a Model S can charge 80 percent of its batteries in less than 20 minutes. Unless the Indian government takes the electric option seriously by building charging stations—New Delhi was recently rated the most polluted city in the world, with auto emissions a major contributing factor (along with crop burning), so no reason not to—its car-hungry cities will end up becoming un-liveable in a decade.
Perhaps we should take a page from the country that we love comparing ourselves to but are decades behind. Municipal governments in many major Chinese cities, for instance, banned gas-powerd vehicles decades ago forcing millions to take to electric two-wheelers. Consequently, China has the highest number of them on its roads—upto 20 million—and it may require a similar effort to prevent a potential environmental disaster in India considering we are just embarking on our growth trajectory.
As for the eternal debate between which is a bigger polluter, a fossil-fuel car or an electric one, an article in MIT's technology review says "even when you factor in the carbon emissions and pollution from the power plants that produce the electricity to power the cars, and from manufacturing and disposal, electric cars produce about 40 percent less carbon dioxide and ozone than conventional cars." Enough said.