Bajaj Chetak electric scooter bookings on a pause for now: Company to localise components sourced from China

Bajaj's electric scooter, Chetak, totally designed and developed in-house, was launched in January 2020 with a price tag of Rs 1 lakh and a running range of 98 km per charge. The scooter was initially launched in the Pune and Bengaluru markets and was to be launched in other cities thereafter.

By:September 16, 2020 10:44 AM

 

The return of Bajaj Auto’s iconic Chetak scooter in its new electric avatar generated a lot of interest among Bajaj’s loyal customers. However, disruption in the supplies from China and the consequent long waiting period has forced the company to put a pause on fresh bookings of the Chetak electric scooter for now. Bookings will resume once the company starts work on localisation of component manufacturing. Bajaj’s electric scooter, Chetak, totally designed and developed in-house, was launched in January 2020 with a price tag of Rs 1 lakh and a running range of 98 km per charge. The scooter was initially launched in the Pune and Bengaluru markets and was to be launched in other cities thereafter. Chetak deliveries had started in these two cities through a network of 18 dealerships and company showrooms. Bookings since then have been greater than their cumulative deliveries. The company has not revealed booking or sales data of the electric Chetak yet.

Rakesh Sharma, ED, Bajaj Auto, said the immediate response the company received in January and February surpassed expectations. However, around the same time, the company started facing interruptions in the supplies of key components being sourced from Wuhan itself.  “This seriously impaired our ability to respond to the customer requirements resulting in long waiting periods. Since there is a likelihood of long waiting periods evoking negative sentiments, we had to take the difficult decision to stop taking bookings,” Sharma said.

Bajaj had to close bookings between March and April 2020, after Wuhan closed down. In September again, Bajaj Auto has halted bookings for the second time, as the frequent lockdowns in Pune and factory closure disrupted production coupled with flow of components from China being hampered.  Bajaj Auto’s dependency on imports from China is very low for a majority of their product portfolio barring the electric scooter. Production of electric scooters have been severely affected because of the pandemic and subsequent disruptions in China and India. When production in China was restored, India went into a lockdown so Chetak had to deal with many hurdles on its ride back into the Indian market.

Since then Bajaj has started working towards reducing complete dependency on some critical components from China so that it had other options to fall back on. “We have accelerated a programme for complete localisation through development of alternate vendors. Once we are confident about it then we will resume bookings in the two cities we are currently operating in,” Sharma said. Bajaj is going to steady the supply chain, which required development of alternate and additional vendors including the validation of their components, he said.  The pan India roll out of Chetak depends on a few other factors beyond just the supply chain capability, Sharma said. “We will evaluate customer experience, response of the charging ecosystem as well as the financials before we undertake major roll outs,” Sharma said. Development of alternative vendor base is seen as a big challenge and could come in the way of a fulsome development of the electric portfolio for Bajaj Auto and also all other electric vehicle makers in the country.

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