Raja Gayam Gives 3 Reasons to Switch Fully to Electric Vehicles
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
Raja Gayam started Gayam Motor Works in 2011 in Hyderabad along with his brother Rahul Gayam and collegemate Sri Harsha Bavirisetty. The electric two- and three-wheeler manufacturer offers services to the likes of Swedish furniture giant IKEA, e-commerce giants such as Amazon and Flipkart, grocery delivery start-ups BigBasket and Grofers, among many others.
Entrepreneur India met Raja Gayam, founder and chief executive officer of Gayam Motor Works, at a time when Delhi is struggling with alarming levels of the air quality index. He discusses the ecosystem of EVs in India, praises some steps of the government but adds the road towards complete EV adoption is long.
Reasons India Should Switch to EVs
He gives three reasons why India must switch to electric vehicle adoption fully. He says, “To improve the health of our citizens, we definitely have to make this happen. That's the first and the primary reason.”
The second reason, he says, is, “We are at a point in history wherein electric vehicles are cheaper in terms of total cost of ownership as compared to an internal combustion engine.” He says there is 35 per cent operational saving when there is switch from diesel-powered vehicles to electric vehicles.
Gayam says India exports manufacturing tools and software to not just the developing countries but also to the developed countries. And the third reason to switch to EVs is to secure the future of manufacturing jobs in the country since “India wants to become a manufacturing hub of electric vehicles”.
Gayam says investments in the electric vehicle ecosystem is required if India wants to dominate the sector. He says, “We need to invest in electric vehicle manufacturing, the business models, swapping stations and charging stations. That will make us future-ready for dominating the two-wheeler and three-wheeler market segments specifically.”
Gaps in the EV Ecosystem—The B2B Perspective
The government of India has levied only 5 per cent GST on electric vehicles. Gayam calls this move “positive” and “fantastic”. He also says the government’s goal of achieving 30 per cent EV adoption by 2030 is realistic one since the “focus is on two-wheelers and three-wheelers and not all vehicles”.
He also added that one of the key gaps in the ecosystem comes from the financing space because the banks are unwilling to fund electric vehicles. Why? Lack of credible track record remains the primary reason. He explains, “Actually, banks have funded some of the low quality electric vehicles that came up a few years back and they are skeptical because of that.”
In such cases, he shares, “What we are asking the government is to have some kind of loan guarantee mechanism, which will make it comfortable for banks to basically fund new products developed by start-ups like us.”
He also points out that the survival of their start-up depends on financing unlike the big players in the auto market for whom EV is just a small part of the story. He says, “We are moving from hundreds to thousands of electric vehicles and financing is one key obstacle that we are facing right now.”
Gaps in the EV Ecosystem—The Passenger’s Perspective
Gayam also elucidates preparations to be done in order to ensure that the travellers or users find ease in making the switch. In today’s fast-paced world, when millennials want everything at the click-of-a-button from food to cabs, waiting for 25 to 30 minutes at a charging station is nothing less than inconvenience. He adds, “So we need to build infrastructure of swapping stations which will help reduce the refueling time to less than one or two minutes.”
Infrastructure will drive faster adoption especially among the people who are on the receiving end, he says.
Start-ups Will Drive the EV Revolution
Raja Gayam is not afraid of competition from the big players.
He even says “they have beaten some of the very well established manufacturers” and that’s what convinces him of the thought, start-ups will spearhead the EV revolution in India. He says, “The large established players are like dinosaurs. They take a lot of time in a field where you need to keep changing, updating on a daily or monthly basis. Their reaction time is very slow.”
He did say until a few years ago, he would have been unsure but experience has given him immense confidence in his own product.