Hosur emerging as a hub for manufacturing of e-scooters

Hosur, the industrial town just outside Bengaluru, and adjoining areas in Krishnagiri and Dharmapuri districts are fast emerging as a hub for manufacturing e-scooters and their accessories like batteries.

Five companies, including Ola, have signed Memorandums of Understanding (MoUs) with the Tamil Nadu government for setting up their factories to manufacture e-scooters, touted as the future more so with the ever-increasing fuel prices, in and around Hosur.

Ola, Ather, Sri Varu Motors, and Simple Energy will manufacture e-scooters from their brand-new factories, while TVS Motor Company is rolling out electric two-wheelers from its sprawling manufacturing unit in Hosur. Ampere will invest Rs 700 crore in its manufacturing unit in Ranipet, while Ola has pledged an investment of Rs 2,400 crore.

Since the state government wants the entire eco-system for electric two-wheeler manufacturers to be based out of this region, it is now wooing top battery makers in the country to set their shops to manufacture batteries for e-scooters.

A senior government official told DH that Guidance Tamil Nadu is in talks with big names in the sector like Exide and Amara Raja to set up their units to manufacture batteries for e-scooters. Lucas-TVS, ELETS, Li Energy, and Stanadyne have already signed MoUs for setting up their units to produce batteries for electric two-wheelers.

“To create an eco-system, we need both scooter manufacturers and producers of accessories like batteries in the same region. While we continue to woo more electric scooter companies, we are also focusing on getting more battery makers to send the right message to prospective investors,” the official said.

The industrial town of Hosur, which has been basking in huge investments in the past few years in varied sectors, is home to many two-wheeler majors and the state government wants to convert it into a hub for e-scooters, much like it transformed Chennai into India’s very own Detroit.

“Hosur is a developed town, and it is one of the favourite destinations for investors due to its proximity to Bengaluru. Another advantage for the state government is its agencies possess huge land banks in Krishnagiri and Dharmapuri districts. Most of the new units are coming up here,” the official said.

The state has had an exclusive EV policy since 2019 that offers sops like 100 per cent reimbursement of SGST till December 31, 2030, 15 per cent capital subsidy and 100% electricity tax exemption till December 2025. It also provides a 20 per cent capital subsidy for EV battery manufacturing till December 2022.

Consortium of Indian Association (CIA) Convenor K E Raghunathan said the Tamil Nadu government should ensure that the entire value chain of electric vehicle manufacturing is in Tamil Nadu and that the state provides end-to-end solutions.

“We have ensured that we are a macro-level product giver. What about input products? The government should incentivise with State offered PLI schemes to MSMEs to become competitive over others outside the state. We need to identify needs, prepare technology support through innovation hubs, and identify start-up entrepreneurs,” he told DH.