Having started as a supplier to Tata Motors' electric vehicle program, Pune-based Electra EV is now ready to expand its horizon, both within India, and beyond.
11 Nov 2024 | 8243 Views | By Shahkar Abidi & Ketan Thakkar
In the sprawling automotive hub of Pune, where the hum of engines and the clink of tools echo through the industrial landscape, Electrodrive Powertrain Solutions Pvt Ltd, a leading supplier of EV parts such as motors, batteries and vehicle control units, is getting ready for the next phase of its ...
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In the sprawling automotive hub of Pune, where the hum of engines and the clink of tools echo through the industrial landscape, Electrodrive Powertrain Solutions Pvt Ltd, a leading supplier of EV parts such as motors, batteries and vehicle control units, is getting ready for the next phase of its growth. Currently among the stalwart suppliers to Tata Motors’ electric vehicles (EV) programs, the company is engaged in an ambitious expansion project, aimed at increasing the share of non-Tata customers from 5% to 20%.
Electra EV’s current status belies its modest beginnings as a daring experiment, born out of the crosswinds of traditional engineering and the restless vision of those eager to glimpse the future. It was started by Ratan Tata in 2015-2016 as a side project intended to explore the emerging possibilities of the electric vehicle sector.
By 2017, the experiment had a name—Electrodrive Powertrain Solutions Pvt. Ltd. Ratan Tata’s idea found its early form in an electrified Nano developed for Ola Cabs.
As the business began to gain momentum, it became increasingly apparent to Ratan Tata that the project needed a full-time, dedicated leadership team. This prompted Tata to pick up the phone and reach out to Samir Yajnik, then President of Global Delivery and COO for Asia Pacific at Tata Technologies—a man with whom Tata shared a deep professional rapport.
“He said to me, ‘Look, I have many unfulfilled dreams. This is one of them. How would you like to go and make it happen?’” says Yajnik, who is now the CEO and ED of Electrodrive Powertrain Solutions. Yajnik’s mission was unambiguous: to streamline the operations of existing orders and restructure the team for the challenges ahead. Yajnik was soon joined by Sumeet Dhar as the company’s new Chief Operating Officer.
All of this unfolded as India was beginning to embark on its own electrification journey. The central government's landmark EV subsidy program, the Faster Adoption and Manufacturing of Hybrid & Electric Vehicles in India (FAME India), which had provisions for subsidies for fleet cars, was drawing the attention of automakers towards this sunrise sector.
Some of them began to introduce electric vehicles, though options and range remained limited.
Amid all this, another important development took place in 2017: The government issued its first tender for electric vehicles, an event that would prove to be crucial towards kickstarting automaker Tata Motors’ EV journey.
Tata Motors won the contract for supplying 10,000 electric cars, outbidding Mahindra & Mahindra (M&M) in the contest for the Rs1,120 crore order, the largest such procurement anywhere in the world at time. Nissan Motor was the third OEM to participate in the bid, but it failed to qualify as they could not indicate what product they were planning to offer. Later on, there was some redistribution, and some of the orders were reallocated to Mahindra & Mahindra.
The contract was pivotal for Electrodrive Powertrain Solutions: Its work on the experimental Nano project had not gone unnoticed, and the company ended up getting the contract for supplying most of the critical elements of the new EV. The team at Electrodrive had their first real taste of success when, within a few months, Tigor EV received ARAI certification.
With Yajnik and Dhar steering the ship, the Electra EV-Tata Motors partnership gradually established itself in the burgeoning electric vehicle market. By 2018, Electra achieved another milestone with the commercialisation of the Tata XPres T Gen 1 electric sedan. This success was followed by the development of an electric bus for a Pune Corporation tender the following year.
Yajnik and Dhar then faced the challenge of scaling their operations, a critical consideration given the fast-changing dynamics of the automotive industry. Initially, Electra EV was involved in five projects: Tigor, Zest, Tiago, Magic, and Iris. After securing a successful order from the EESL tenders, Tata Motors' then-chief, Guenter Butschek, was confident about electrifying all these platforms.
However, due to changing market conditions and the competitive landscape surrounding the tender, Tata Motors decided to shelve most of these projects, leaving Electra EV to focus on the Tiago and ACE platforms. Interestingly, many of the canceled projects had reached the homologation stage before being discontinued.
The Nano electric project, on the other hand, was intended solely for Ola Cabs, with a limited production of around 250 units. The Electra management was skeptical about the long-term viability of Ola Electric, predicting its eventual decline due to its inability to achieve profitability.
Diversification Attempt
The current attempt to move beyond the Tata fold is not the first such move by the company. In 2019, as Electra EV sought to rope in more manufacturers. However, the company was unlucky, as the world was hit by the pandemic soon after. The resulting disruption proved daunting: although Electra managed to initiate a handful of new projects, none were game-changing. OEMs were wary, reluctant to commit significant volumes during such an uncertain period.
A case in point was Stellantis, which extended a letter of intent that ultimately faltered over localisation disputes. With orders drying up, Electra faced the unsettling challenge of maintaining a workforce of 170-200 employees on the back of a dwindling project pipeline.
Yet, amid the turbulence, the ACE project started gaining traction. At the same time, Electra’s Tigor platform advanced to a new phase. However, the company found itself ill-prepared for a shift toward high-voltage solutions; the company’s already stretched resources were overwhelmed by the demands of multiple projects.
The evolution of the ACE EV project encapsulates the broader challenges Electra faced. Initially conceived as the nine-seater Magic D+9, the project’s scope was forced to pivot as the EV landscape shifted, pushing demand toward a D+7 variant—a reimagined version tailored to the changing market. “As e-commerce surged, the emphasis shifted yet again, this time to a cargo variant that better aligned with industry needs,” noted Dhar.
Further complicating the ACE project was a critical decision on battery chemistry. The original ACE prototype employed nickel-cobalt-manganese (NCM) chemistry, but as the industry evolved, so did customer scrutiny. Concerns mounted over the ethical implications of NCM, particularly the use of cobalt, often sourced under exploitative conditions in Africa. This pushed Electra to transition to lithium iron phosphate (LFP) chemistry, which promised not only a better fit for India’s climate but also addressed ethical concerns surrounding raw material sourcing.
Moreover, LFP (lithium iron phosphate) offers a safer, more thermally stable alternative with a longer cycle life, increasingly favored in electric vehicles and energy storage systems.
The company's momentum continued into 2021 with the introduction of a new battery production line at its Coimbatore plant. This expansion set the stage for a remarkable 2022, which saw the launch of the ACE EV and the development of e-LCV high-voltage technology. By 2023, Electra EV had established an automated manufacturing facility, opening up opportunities in the off-highway sectors and export markets. This year, Electra EV has further expanded its reach, developing an e-bus battery pack for a European OEM and creating high-voltage battery packs and powertrains for various vehicles, solidifying its position as a key player in the global electric vehicle landscape.
The progress made by Electra EV must be viewed in the context of the government's evolving policies, particularly the transition from FAME I to FAME II, and now towards PM E-Drive. In the early days of FAME I, low-voltage, two-wheeler architecture was the most viable option. High-voltage architectures now dominate the market, but in 2017, with an underdeveloped ecosystem and supply chain, Yajnik and Dhar focused on what was feasible to meet FAME requirements. They chose a 72-volt architecture as the lowest common denominator, believing that it was the only way to fulfil the FAME criteria with predominantly local resources.
Striking Out
The early support, in the form of a reliable stream of orders from Tata Motors, gave Electra much needed stability in its early years. Today, the company’s overwhelming reliance on a single customer is being seen as a potential limiting factor for the company’s growth,even within a firm backed by the venerable Ratan Tata. Last year, for example, out of the total revenue of Rs 295 crore, nearly 95% came from Tata Motors’ business.
The strategy of growing through diversification has been endorsed by none other than Ratan Tata, who said Yajnik, pointed out to him that striking out on its own was the only way for Electra EV to achieve the kind of growth that Yajnik envisioned.
In its efforts to diversify its client base and secure its revenue model, Electra EV is scouring the global automotive landscape. For the European and American markets, the company is focusing on microcar battery packs and powertrain systems, while also supplying battery modules to European manufacturers.
Internationally, the company is taking a measured approach, initially targeting smaller ventures by forging partnerships with European firms to gradually broaden its footprint. Progress has been made in niche markets, with the company securing a foothold in the cylindrical battery pack sector, having recently received the green light to proceed. Yet, not all initiatives have gone smoothly. A promising project involving hydrogen buses was abruptly shelved following the bankruptcy of a key German partner, pointing to the inherent volatility of the market, company executives noted.
Back on home turf, Electra is advancing with a 300V battery pack tailored for the burgeoning domestic electric vehicle market.
It is also working on a mini electric excavator for the construction sector, and has also come up with a reverse trike battery pack for Indian electric three-wheeler makers.
Currently, Electra’s Coimbatore facility boasts the capacity to produce over 30,000 kits annually, employing state-of-the-art technologies like laser cleaning and welding. But, for the company, this is just the beginning. Yajnik wants to establish a flexible manufacturing hub for battery pack assembly. It will accommodate a range of configurations, from blade cell battery packs to prismatic and cylindrical cell packs for both two- and three-wheelers. On the drivetrain front, Electra is investing in a versatile 2-in-1 assembly line for PMSM motors up to 25 kW and beyond, aligning with compliance requirements to localise motor parts. Further ambitions include setting up a common charging facility catering to both low- and high-voltage battery packs.
The management acknowledges that a significant capital infusion—around $50 million—will be crucial to support its ambitious expansion. This funding will be used for international growth, investments in manufacturing and R&D, and to strengthen sales and supply chain infrastructure.
To this end, Yajnik has remained grounded in Mumbai, engaging with investors and bankers to rally financial support. This pursuit of capital bore fruit in late 2022, when Electra EV secured $25 million from GEF Capital, a private equity powerhouse with a reputation for nurturing transformative ventures, including EV startup REVA.
The Road Ahead
Electra EV's ambitions stretch across a sprawling landscape of mobility sectors, from cars to two-wheelers and three-wheelers, each home to well-established competitors. The company has even ventured into the niche market of electric tractors and even electric boats.
Yajnik insists there is a unifying thread that connects these diverse ventures. He describes Electra’s approach as a calculated exploration of various segments through the lens of electrification. According to him, the company’s strategy revolves around identifying essential components—battery packs, which serve as the power source, and energy dissipation systems, the critical sink—that can be adapted across multiple sectors. The idea is to provide powertrain solutions that integrate drivetrains and battery packs, irrespective of the vehicle or vessel.
It’s a pragmatic method, driven by the idea that these core technologies, whether battery packs or drivetrains, can be deployed in any market Electra touches. However, Yajnik concedes that the company’s focus is not set in stone. He points out that should a specific sector, like tugboats, experience a sudden surge in demand—perhaps spurred by new regulations, as seen in Amsterdam – Electra might recalibrate its priorities. But despite the shifting tides of market dynamics, points out Yajnik, Electra has one core mission – electrification, irrespective of the form and format.
In a world where the boundaries of electrification are continuously expanding, Electra EV’s cross-sector approach is both a bold bet and a complex balancing act, navigating a course where the destination is constantly evolving.