Livemint.com: Mahindra MD Goenka speaks on plans for the international electric vehicle market, learnings from Formula E
Mahindra Racing ended the inaugural FIA Formula E 2014-15 season for electric racing cars strongly. Driver Bruno Senna finished the last race in London held on 28 June in fourth place, the season’s best finish by any of the team’s two drivers—the other being Karun Chandok. On the sidelines of the race, Mint spoke to Pawan Goenka, Mahindra’s executive director and the president of automotive and farm equipment sectors. Goenka spoke about the brand’s plans for the international electric vehicle market and key learnings from what has been a difficult Formula E season for the brand’s racing outfit. Edited excerpts from the interview:
It has been a difficult first season for you. You finished eighth out of 11 teams. Do you still remain committed to the event?
Absolutely. Look at today. I think 60,000 people have turned up for this race today. That is great. At the end of the season, our commitment to Formula E has only been reinforced. We are happy with what it has done for our brand, for our global visibility and I must say that it has exceeded our expectations as an organization.
Our results have not been good. But I think we should be here. We should be a part of this.
Is the involvement in electric car racing at this level feeding back into your research and development activities?
Yes. But right now, all the cars are standard. So, there is a limit to what tinkering we can do with the vehicle. But that is changing. Next year, the Formula E rules will allow us to work on the motor and the transmission. And each season will see teams getting more and more freedom to build customized cars. And that means Mahindra Racing will get an increasing chance to work on the technology. Which is ultimately the kind of exchange we want to see.
What plans do you have for the UK market?
Our plan is to enter the market exclusively with electric vehicles. Both two and four-wheelers. We have had some very good discussions with the UK government about this. And we want to cater to the sub-£10,000 segment of the electric vehicle market. We just got the results of some extensive market research we carried out in the UK. And we are happy with what we see. In the first quarter next year, we plan to introduce a new version of e2o model in the UK.
How do you plan to execute distribution and badging? Will you use the Ssangyong brand you already have in the UK?
Our cars will badged as Mahindra cars. And right now, we are thinking of building our own distribution network in the UK.
We want to be seen as a serious OEM (original equipment manufacturer) with a long-term vision. And in the UK, we want to target the inividual buyer. Perhaps people who are looking to buy a second car in the sub-£10,000 range for short commutes and inner-city driving. We are not here to plug a technology gap, but a price gap.
Mahindra was one of the earliest movers, so to speak, in this segment. Are you happy with what you have achieved so far?
We are not nearly where we thought we would be when we started. We were expecting to sell at least five times as many e2o vehicles as we have. There are many factors for this. For instance, there was a subsidy for electric vehicles that was removed in India. But I think it will come back. And that will help.
But I think we need to do more work to convince customers. We need to build more trust in the idea of an electric car. That you can travel a certain distance on a charge. That will take time. And it will also take the infrastructure needed to charge cars.
But we are doing this for reasons beyond just profit and loss. There are other motivations for investing in this and committing so much to electric vehicles. We want to make a difference. We want to redefine the future of mobility. In India and abroad. And for this, scale is important. I don’t want our people to get demotivated. So, we need to work on ramping up sales.
Meanwhile, are you expecting greater competition in India and elsewhere?
Yes. And I welcome it completely. Right now, we need to increase the size of that pie. We don’t want to be the only player. Let more people come and expand the market.
Speaking about cars in general, and not just electric ones, it has become a particularly challenging environment for innovation. Suddenly, there is huge movement on two fronts: driverless cars and in-car technology. How are you coping with both?
We are not directly working on autonomous cars. But we have announced the Mahindra Rise Prize Driverless Car Challenge. We received 259 teams from all over the country, of which we have shortlisted a dozen exciting proposals for driverless cars for Indian conditions. The winning idea will get a million dollars.
As for the concept of a connected car, Mahindra actually does a lot more work on this than many people realize. The XUV 500 has more connectivity than most people will need. We have also signed up with Google for their connected car platform. And we have people at Tech Mahindra working on this as well.
Yes, there are a lot of changes happening. Some of which seemed nowhere on the horizon 10 years ago. But that comes with the business. We need to deal with that. And Mahindra has the resources to do it.
Mahindra Racing ended the inaugural FIA Formula E 2014-15 season for electric racing cars strongly. Driver Bruno Senna finished the last race in London held on 28 June in fourth place, the season’s best finish by any of the team’s two drivers—the other being Karun Chandok. On the sidelines of the race, Mint spoke to Pawan Goenka, Mahindra’s executive director and the president of automotive and farm equipment sectors. Goenka spoke about the brand’s plans for the international electric vehicle market and key learnings from what has been a difficult Formula E season for the brand’s racing outfit. Edited excerpts from the interview:
It has been a difficult first season for you. You finished eighth out of 11 teams. Do you still remain committed to the event?
Absolutely. Look at today. I think 60,000 people have turned up for this race today. That is great. At the end of the season, our commitment to Formula E has only been reinforced. We are happy with what it has done for our brand, for our global visibility and I must say that it has exceeded our expectations as an organization.
Our results have not been good. But I think we should be here. We should be a part of this.
Is the involvement in electric car racing at this level feeding back into your research and development activities?
Yes. But right now, all the cars are standard. So, there is a limit to what tinkering we can do with the vehicle. But that is changing. Next year, the Formula E rules will allow us to work on the motor and the transmission. And each season will see teams getting more and more freedom to build customized cars. And that means Mahindra Racing will get an increasing chance to work on the technology. Which is ultimately the kind of exchange we want to see.
What plans do you have for the UK market?
Our plan is to enter the market exclusively with electric vehicles. Both two and four-wheelers. We have had some very good discussions with the UK government about this. And we want to cater to the sub-£10,000 segment of the electric vehicle market. We just got the results of some extensive market research we carried out in the UK. And we are happy with what we see. In the first quarter next year, we plan to introduce a new version of e2o model in the UK.
How do you plan to execute distribution and badging? Will you use the Ssangyong brand you already have in the UK?
Our cars will badged as Mahindra cars. And right now, we are thinking of building our own distribution network in the UK.
We want to be seen as a serious OEM (original equipment manufacturer) with a long-term vision. And in the UK, we want to target the inividual buyer. Perhaps people who are looking to buy a second car in the sub-£10,000 range for short commutes and inner-city driving. We are not here to plug a technology gap, but a price gap.
Mahindra was one of the earliest movers, so to speak, in this segment. Are you happy with what you have achieved so far?
We are not nearly where we thought we would be when we started. We were expecting to sell at least five times as many e2o vehicles as we have. There are many factors for this. For instance, there was a subsidy for electric vehicles that was removed in India. But I think it will come back. And that will help.
But I think we need to do more work to convince customers. We need to build more trust in the idea of an electric car. That you can travel a certain distance on a charge. That will take time. And it will also take the infrastructure needed to charge cars.
But we are doing this for reasons beyond just profit and loss. There are other motivations for investing in this and committing so much to electric vehicles. We want to make a difference. We want to redefine the future of mobility. In India and abroad. And for this, scale is important. I don’t want our people to get demotivated. So, we need to work on ramping up sales.
Meanwhile, are you expecting greater competition in India and elsewhere?
Yes. And I welcome it completely. Right now, we need to increase the size of that pie. We don’t want to be the only player. Let more people come and expand the market.
Speaking about cars in general, and not just electric ones, it has become a particularly challenging environment for innovation. Suddenly, there is huge movement on two fronts: driverless cars and in-car technology. How are you coping with both?
We are not directly working on autonomous cars. But we have announced the Mahindra Rise Prize Driverless Car Challenge. We received 259 teams from all over the country, of which we have shortlisted a dozen exciting proposals for driverless cars for Indian conditions. The winning idea will get a million dollars.
As for the concept of a connected car, Mahindra actually does a lot more work on this than many people realize. The XUV 500 has more connectivity than most people will need. We have also signed up with Google for their connected car platform. And we have people at Tech Mahindra working on this as well.
Yes, there are a lot of changes happening. Some of which seemed nowhere on the horizon 10 years ago. But that comes with the business. We need to deal with that. And Mahindra has the resources to do it.
