What we missed explaining during the launch of Ather 450X
We launched the Ather 450X last week to some fantastic product reviews.
At launch, we explained 450X’s improved performance, the significantly improved dashboard, about the super fast charging, our expansion plans etc. We spent some time explaining a new way of owning the 450X — subscriptions. Subscriptions that include the cost of battery, data, software upgrades, fast charging etc. and which allow us to guarantee a ridiculously high level of consistency in performance that no EV maker is offering.
But we missed explaining two things:
- Ather 450 is not discontinued and will be sold as Ather 450X + (yes, it even gets a longer name now)
- That we were increasing the price for Ather 450
So some backstory first
Back in 2018 when we were gearing up to launch the Ather 450 for the first time we had to take a wild guess on what pricing would work. The 110cc petrol scooter market was at 75K and your average lead acid electric scooter was even worse at a price point of 40K. None of these price points were feasible for a good electric scooter in India. We took a bet and launched Ather 450 at 1.25L.
We had no way of making money at that price point, 5kW motors alone would cost you 25–30K and batteries nearly 75K, before you bring in the rest of the vehicle into the mix. And without volumes on day 1, it was a massacre.
We were losing more money than we charged as revenues. Even on things like connectivity services, servicing, Ather was establishing a brand new benchmark with first of its kind OTA software upgrades, first of its kind fast public charging and door-step service and no questions asked servicing commitment. All of this costed 2-5X of what we were pricing them at.
And we were okay with it.
We like taking long-term bets with what we do at Ather. While the cost of everything was higher we had a sense that all of it becomes cheaper as you throw more and more engineering and product brains on it. Volumes will also help of course. So we stuck with the pricing.
Over the course of the last year our costs improved dramatically on all fronts. But as things started to stabilize, we realized that at the existing price the scooter itself wasn’t going to be sustainable. Globally our best competitors were producing at higher cost points for comparable specs despite already having significant volumes. Even existing legacy OEMs have gone on record to acknowledge that EVs at existing price points are still nonviable at scale. And this despite having lower performance, charging and connectivity specs than the Ather 450 and 450X.
The market had to move up. We had to increase the price of Ather 450.
Not to suddenly mint money, but to start breaking-even. Due to the success of the 450, Ather is an important influence in the Indian EV market. The ecosystem is looking at how we grow. If we are not willing to prove that people will pay fair price for an experience like the 450 then it’s hard for the market to really believe that electric is here and inevitable. And while I am glad that we finally have credible EVs coming out post the 450 launch, I also believe that the primary purpose of Ather is to not sit back and compete but push the boundaries of what electric and connected can do.
That’s what Ather 450 did originally in 2018 and that’s what 450X does again. Today, one of the quickest scooters in India is electric. One of the smartest scooters globally is an Indian product. The first scooter with 4G, the first with an aluminium chassis, the first one to move to Android. It’s an Indian electric scooter that’s brought in the concepts of leasing, subscriptions, infinite warranties, software upgrades and much more to the market.
Electric is no longer playing catch-up with its petrol variants. Electric is leading the market. That’s what you get when you buy the Ather 450 series. And I am glad that we can finally do that and build a sustainable business in India.
