Bike rental startup Yulu said it wants to take its business to the next level by getting into sales of electric two-wheelers with its existing partner Bajaj Auto.
The Bengaluru-based company has so far stayed away from getting into vehicle sales because of lack of adequate know-how about providing the service backup.
Amit Gupta, CEO, Yulu, said, “It is up to Bajaj Auto’s sales strategy. The platform we have built can create multiple two-wheeler avatars which can be branded differently. This can be a Bajaj brand product with a Yulu technology and the canvas we have is quite large.”
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The company is planning to raise $500 million in the next three years to have a fleet of one million operational two-wheelers by 2025, from 100,000 by the end of 2023. Gupta added that the funds raised won’t be through equity dilution but through debt.
“We get a lot of enquiries from users if they can buy the same vehicle from us. Right now, we provide services institutionally. But when we start selling vehicles, we need a service backbone. Bajaj provides us with infrastructure support. The part after sales is not ready yet and once we tick all those boxes, we will announce it,” Gupta added.
Pune-based Bajaj Auto
Yulu can potentially fill up the under Rs 100,000 space for Bajaj Auto as the only product the latter has in the electric two-wheeler category is the Chetak, which is priced at Rs 120,000 (ex-showroom).
Bajaj Auto is the only company among the three domestic companies in the mass-market two-wheeler space to yet have a presence in the EV category through a startup. Hero MotoCorp has a presence through Ather Energy while TVS Motor Company
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“In the space of the next 12 months or so, we will have a portfolio which will span from the low-speed, low-range delivery and personal mobility products to top-of-the-line, personal mobility scooter and other products in the middle, being sold to about 100-150 stores across the country,” Rakesh Sharma, executive director, Bajaj Auto, said.
Sales run rate of the Chetak has been on the lower side when compared to rivals like TVS iQube and Ola S1. Bajaj sold around 2,500 units of the Chetak in February, whereas Ola clocked nearly 18,000 and TVS sold around 12,500 units. Bajaj has promised its shareholders of launching ‘one new Chetak every year’, which also includes the joint product work it is doing with Yulu.