22Kymco shuts down: Electric vehicle start-up packs up after launch announcement

As is usually the case with electric vehicle start-ups, even 22Kymco with a strong funding couldn’t take off, with many factors being contributors.

22Kymco shuts down: Electric vehicle start-up packs up after launch announcement
22Kymco officials with the product range for India

Kymco is a big Taiwanese electric two-wheeler maker. The brand even exports and is one of the world leaders as far as electric vehicle tech is concerned. So, it came as no surprise to anyone that Kymco will want to expand and foray into regions where their presence was needed. Emerging markets for example, and India was naturally the best choice for it. So, in October 2018, Kymco joined hands with 22 Motors (an EV start-up) for entering the Indian market. The company was called 22Kymco.

What was the deal between both the companies?

22 Motors on its own had developed a couple of scooter prototypes. The brand has approached Hero Motors (bicycle) for an investment. Hero, while interested, couldn’t fund 22 Motors because of its internal issues. You see, having a successful sibling (Hero Electric) in the same business will mean dinner table wars. A common source knew that Kymco was looking to enter India at that point of time and things fell in place for 22 Motors and the former. Allen Ko, chairman of Kymco, was apparently fascinated with the designs and underlying idea.

It is being understood that Kymco will be at the forefront of technology as well as manufacturing know-how. 22 Motors, lead by Parveen Kharb (CEO and co-founder), will manufacture the electric as well as ICE two-wheelers in India. A manufacturing plant was rented in Bhiwadi, Rajasthan. This plant had an initial capacity of two lakh units in a year. Approximately Rs 12 crore was invested by the domestic investors in this operation whereas KYMCO put in USD 2 million. The latter, over the course of time, was going to pump in USD 10 million more. The required tools as well as materials are already in the facility. As of now, the tools and machines are rusting there, lying unused.

Over the course of next three years, starting from 2019, 22Kymco had planned more than 300 dealerships in India. The initial stage of 14 dealerships were to be in New Delhi, Bangalore, Pune, Hyderabad, Kolkata and Ahmedabad cities.

The products that were supposed to come

The product line-up includes the iFlow scooter (Rs 90,000), Like200 (Rs 1.3 lakh) and the X-Town 300i ABS for Rs 2.30 lakh. All these prices are on-road Delhi. While the iFlow was an electric scooter, the other two ran on petrol. 22Kymco was to manufacture all these vehicles in India from start. The commercial sales were to start from September 2019. This was announced at the second press conference held in June 2019.

The USP of Kymco was the Ionex and Ionex Commercial solutions. Ionex was claimed to be a game-changing electric vehicle solution that eliminates all barriers for consumers to go green. Ionex Commercial is a tailor-made solution for operations that need a much larger setup. Part of this solution was the Ionex smart battery that weighed only 5kg. It was swappable but the iFlow for example, also had a reserve battery. The main battery ensured that the reserve unit was always charged and when the time came to swap, the user could still ride 20km on the fixed unit. This means there was literally no downtime. Ionex in general can be used by any OEM, should they desire.

All in all, the products were very capable and given that Kymco had a good reputation worldwide, will have helped their case immensely in India.

What went wrong?

Mismanagement has been claimed to be one of the factors. There were talks of how one partner never wanted to go with the premium nature of the products and wanted a Rs 40,000 electric scooter. This steam rolled into behind-the-back talks. Allen Ko, it seems got the impression that his Indian partners aren’t on the same page. This lead to Kymco finally refusing to pump in any more finance, thereby stalling the operations.

In June 2019, right after the announcement, the decision was taken to disband the company. An email was sent out to vendors, employees as well as the media agency in July. This email stated that the company has now been dissolved due to operational reasons. The 100+ employees were left in the lurch too. In a conversation with former executive director, sales marketing, Partha Choudhary, we learnt that it was indeed a very sad situation. A bunch of enthusiasts coming together for an electric vehicle project and then everything goes bust.

An ex-employee on the condition of anonymity said that “One day things were fine and we were in the midst of starting production. The very next day, before production could start, we were asked to find new jobs.”

What next?

While 22Kymco is no longer in existence, the website is still there. Partha and his colleagues are on to something new and exciting. What is it? Well, watch this page for more information.

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