The founder of ride-sharing group Ola says giving special incentives to Tesla in India is not in the country’s interest as New Delhi strives to accelerate the growth of local champions in the electric vehicle sector .
Bhavish Aggarwal, the chief executive of SoftBank-backed Ola, is jumping into the country’s nascent electric vehicle market as the country of 1.4 billion people embraces renewable energy to reduce fossil fuel emissions.
Ola, along with a handful of other companies including Mukesh Ambani’s Reliance Industries and Hyundai, recently won a tender under India’s $2.4 billion scheme to boost local cell production of battery.
“Tesla is free to come here and sell their cars,” Aggarwal told the Financial Times. “They just want to be treated differently from others, which I think is not in India’s interest.”
Tesla has not started manufacturing operations in India. Founder Elon Musk tweeted in May that “Tesla will not set up a manufacturing plant in a place where we are not authorized to sell and service cars”. Musk did not respond to a request for comment.
Musk’s electric vehicle company has had huge success in China, where it has helped develop a fledgling industry. In return, Beijing offered the company incentives including tax breaks and low-interest loans.
Although Maruti Suzuki, a subsidiary of Japanese Suzuki, sells more passenger cars than any other company in India, many foreign automakers have struggled in India.
In September, US automaker Ford decided to stop manufacturing in India after its top Indian executives were released on bail in an alleged cheating case and after years of heavy operating losses.
Prime Minister Narendra Modi’s government has pushed a “Make in India” policy and encouraged local alternatives rather than foreign companies.
Since Ola launched in 2010 as a ridesharing app, it has expanded into other services, such as deliveries, used car sales and insurance sales.
He founded Ola Electric, an electric mobility company, in 2017, buying Dutch electric scooter start-up Etergo in May 2020 for an undisclosed sum. The company is now India’s largest producer of electric scooters, with total sales of over 50,000.
It competes with major Indian electric vehicle conglomerates. Tata Motors has been manufacturing and selling electric cars since 2019, although the market remains small and sales average around 3,000 per month, according to the company.
Ola began deliveries of its first plug-in scooters in December 2021, with thousands of customers reserving scooters in July. But after a scooter caught fire in March, Ola recalled the batch of 1,400.
Aggarwal called the incident “isolated”, adding: “In very, very rare cases it may happen as has happened with other manufacturers of other electric vehicles.” He said Ola was cooperating with a government investigation launched in March into the electric scooter fires.
He played down a string of high-profile outings across the group, including his chief operating officer last October. “We have a very strong layer of management in both of our companies,” Aggarwal said.
Aggarwal’s plans to take Ola public this year have also been delayed as global tech valuations tumble as the US Fed hikes interest rates.
“My endeavors are to get it public in the next approximate one-year timeframe,” Aggarwal said. “But again, it can go up and down, markets are volatile.”
Additional reporting by Richard Waters in San Francisco
