NEW DELHI (Reuters) – A spate of electric scooters catching fire in India, including one made by SoftBank-backed Ola Electric, is sparking safety concerns among some buyers, in an early setback for a nascent sector Prime Minister Narendra Modi is bullish about.
India wants electric scooters and motorbikes to make up 80% of total two-wheeler sales by 2030, from about 2% today, and Modi’s administration is offering companies billions of dollars in incentives to locally manufacture electric vehicles (EVs.)
Sales of electric scooters more than doubled this year, but at least for some prospective buyers, the fires are cause to think twice.
On Saturday, a video of an Ola e-scooter engulfed in flames went viral online, triggering a rare government probe. A scooter from startup Pure EV also caught ablaze and a burning Okinawa Autotech Pvt bike killed two people. The companies say they are investigating the incidents.
Three potential buyers told Reuters they were deferring purchase plans, and dozens posted concerns on social media this week with several saying they were reconsidering whether it was the right time to go electric.
“I had done a lot of research but I am now reconsidering the decision. I will buy a regular motorcycle,” said Praharsh Mahadevia, 28, an engineer from the western city of Ahmedabad.
Nayeem Quadri, an Indian journalist, is also having “second thoughts due to these repeated instances of fires,” he said.
The electric mobility push is critical for Modi’s climate change and carbon reduction goals.
Following the Ola incident, Modi’s government told lawmakers in the Indian parliament it will take “appropriate action” against the manufacturers once the investigations are complete.
Some in government circles say globally vehicles have been recalled by automakers in cases of fires.
“This is a sunrise sector and anything negative is bound to have a detrimental impact,” said Randheer Singh, director for electric mobility at government think-tank Niti Aayog.
“How the situation is tackled will determine how consumer faith and confidence is maintained,” he said.
“UP IN FLAMES”
Video footage of the Ola fire showed one of its popular black-coloured S1 Pro scooters emitting smoke before quickly being engulfed in fire on a busy street in the western city of Pune.
The Okinawa Autotech incident was more deadly. The company said a man and his daughter died when their e-bike “went up in flames”. It cited the police statement which said the likely cause was an electrical short circuit while charging.
Jasmeet Khurana, who leads the World Economic Forum’s initiative on electric mobility in India and emerging markets, said buyers may forgive one-off incidents given the popularity of the cheap-to-run bikes. But, he said, companies must do more to address the concerns.
“The market will continue to grow rapidly but it can grow faster without such incidents,” he said.
Although most people still use petrol-guzzling motorbikes to travel on crowded Indian roads, E-scooter sales are leading India’ clean mobility revolution.
Annual sales are expected to cross 1 million units by March 2023, from 150,000 a year ago, industry data showed. Ola Electric, valued at $5 billion, is making 1,000 scooters a day and has plans to manufacture electric cars and battery cells locally.
Tarun Mehta, chief executive of Tiger Global-backed e-scooter maker, Ather Energy, told Reuters that despite the fires, his sales had been unaffected.
“There is no question of demand derailing. While the incidents are unfortunate, we can’t deny the fact that EVs are here to stay and the shift to electric has begun,” he said.
(Reporting by Aditi Shah, additional reporting by Sumit Khanna in Ahmedabad; Editing by Frank Jack Daniel)