The market has roughly sold 100,000 e-cycles so far and Hero Lectro accounts for nearly 70% of that number
Hero Lectrohas been leading the e-cyclerace in India. Out of the 100,000 e-cycles sold in the country so far, Hero Lectro accounts for 70%. Aditya Munjal, CEO of Hero Lectro speaks to us on the brand's journey so far, a few challenges and a few areas of focus for the brand and the industry to grow.
While the Western world has been big on cycling for years now, things are slowly picking up in India too, and the pandemic has given it just the push it needed. And with this uptick in cycling enthusiasm, the market for e-cycles is slowly heating up too. While still at a nascent stage in India, people are now opening up to give e-cycles a try.
Identifying the opportunity in the space, Hero Cycles has entered the segment and coming up with e-cycles under the brand Hero Lectro. The brand sells e-cycles spanning 15 variants across multiple utilities including products with and without gears. It also provides solutions for commuting, recreation as well as last-mile delivery.
In a recent conversation with Aditya Munjal, CEO of Hero Lectro, we tried to understand a bit more about the segment, where things stand in India and what the future looks like.
The e-cycles industry and where Hero Lectro stands
The e-cycle segment is still at a nascent stage in India but there has been a doubling of growth for the segment in the last few years. The market has roughly sold 100,000 e-cycles so far and Hero Lectro accounts for nearly 70% of that number, shared Munjal. The lockdown gave it the push it needed, with people rediscovering the outdoors and opting for cycling at a time when they were stuck at home and were looking for some kind of activity.
While the first year of the pandemic saw a big surge in demand, growth for the segment has now stabilized, Munjal said.
There has also been a steady evolution in the consumer profile of e-bikes. While initially, it was primarily cycling enthusiasts opting for e-cycles, in the last couple of years, many city consumers are also increasingly looking at e-cycles as a viable mode of conveyance to their work places or simply to work errands. In fact, the growth is no longer restricted to metro cities. “Currently, non-metros account for 6 out of every 10 bikes we sell. We are seeing Tier II and III cities really come up. And within metros, we have seen women increasingly opt for our products as well. Also, in metros, people staying within 15 kilometers of their workspace are starting to use e-cycles. People who would normally share rides or use public transport are now buying the products. Initially, they started by using it once or twice in a week but with time, they've started using the cycles for going to work every day. It's a natural trend where premium cyclists are seeing this as a new technology and revolution, so there's natural excitement,” explained Munjal.
Currently, the brand is witnessing maximum excitement from premium cyclists. “We are also seeing a lot of enthusiasm around our products for work commute. We have just launched cargo and in my view, that is another segment that will bring in a lot of excitement along with numbers,” shared Munjal.
How the government can help in the growth of e-cycles
While there is growing enthusiasm among people for e-cycles, there are still a few roadblocks ahead. The government has been talking about the need for more sustainable mobility but the cycling industry has been kept out of key policies like production-linked incentive (PLI) or Fame 2.
Demand in India also hasn’t taken off yet possibly because of the higher cost of the product, and this, Munjal feels is a problem that can be solved if the government includes e-cycles in its subsidy schemes.
Talking about the kind of support the industry needs to give it the required push, Munjal said, “For us the responsibility is not just to grow the brand but also the segment. We have built a large, truly futuristic factory in Punjab, the idea was to cater to competitive supplies for e-bikes in India and abroad. Globally, we have to compete with decade-old manufacturing facilities in places like China, Taiwan, Cambodia, who have great benefits. So, one benefit that will make us competitive for the world would be the PLI. That’s a direct assistance which will really make the world see India as a true hub for buying e-bikes. The second task is to build demand in India. If the Fame 2 subsidies get extended to e-cycles, the will become more accessible to a lot of new people.”
Focus areas ahead
The brand is currently focusing on coming up with products that fill a need gap. Munjal said going ahead too, the brand will continue doing that while also figuring out ways of making the brand attractive for the younger audience. It has been changing its marketing strategy according to the audience they want to talk to. While it has been using digital to reach out to its target consumers, going ahead, it would also depend a lot on experiential, where a lot of importance will be given to people trying their products.
“Our job is to create a desire for our brands and relating to the audience and their lifestyles today which is changing really fast. Our job is also to create great products and communicate about them in an aspirational manner. We are doing it already and going ahead too, we will continue doing it. Our aim also is to grow the segment on the whole,” said Munjal.