Bajaj Auto is making significant strides in the electric two-wheeler (e2w) market, aiming to establish a dominant position amid rapidly shifting market dynamics. With its electric Chetak scooters making a brief splash in the rankings, Bajaj is gearing up to introduce an upgraded and refreshed lineup. As the market landscape evolves, the upcoming Chetak models promise enhanced features and improved performance, setting the stage for a competitive edge in the electric mobility sector.
Evolving Market Dynamics
In recent months, the e2w market has experienced notable changes in its hierarchy. Bajaj’s Chetak briefly seized the number two spot in September, overtaking TVS Motor Company’s iQube. Throughout this period, Ola Electric has maintained its lead in the market. However, in October, TVS regained its position as the second-largest player, with Bajaj closely trailing behind. This competitive backdrop motivates Bajaj to revitalize its Chetak range, aiming to amplify its presence in the e2w segment.
Launch of Upgraded Chetak Models
Bajaj is set to unveil a “refreshed” range of Chetak scooters, expected to debut in mid-November. Rakesh Sharma, Bajaj’s Executive Director, highlighted the importance of this launch for increasing market share. According to Sharma, the new models will feature competitive specifications and enhancements that promise to improve Bajaj’s profit margins.
“The momentum of market share acquisition should increase further with an entirely new refreshed range being launched,” Sharma stated during a recent analyst call.
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Anticipated Features and Developments
While specifics about the new Chetak models remain under wraps, insiders suggest that these scooters may come equipped with larger batteries and motors, positioning them to compete directly with models like the Ather Rizta. The Rizta, marketed as a family scooter, made waves at its launch with a starting price of INR 109,999 (ex-showroom Bengaluru). This pricing strategy has made it one of the most affordable options in the e2w market, prompting Bajaj to respond with its own competitive offerings.
As part of its strategy, Bajaj previously adjusted the pricing of existing Chetak models to introduce a sub-one lakh variant, responding to the Rizta’s market entry. However, the forthcoming Chetak lineup is expected to be a significant upgrade, featuring improvements such as more spacious seating and enhanced battery capacity.
Distribution Expansion Strategy
In addition to launching new products, Bajaj is intensifying its distribution efforts for the Chetak. The company plans to increase the availability of the electric scooter to 4,000 outlets by January next year, expanding from 1,000 additional locations. This includes existing Bajaj motorcycle showrooms and an increase in exclusive Chetak outlets, which currently stand at 250.
Profitability and Market Impact
Bajaj’s push to expand its e2w portfolio coincides with a crucial turning point for the company’s electric vehicle (EV) segment. As of the second quarter of FY25, Bajaj’s EV lineup has ceased to negatively impact its overall margins, thanks in part to profitable sales from electric three-wheelers.
Rakesh Sharma noted, “This portfolio has now sold a milestone one lakh units in this quarter for the very first time, which is quite significant in our journey towards electrification.”
The sales of electric two-wheelers surged to 70,000 units in Q2, compared to just 40,000 units in Q1 of FY25, indicating a promising growth trajectory.
Future Outlook: Freedom 125 and CNG Expansion
While the focus on electric two-wheelers intensifies, Bajaj is also optimistic about its CNG bike, the Freedom 125. The company reported retailing 10,000 units of this model by September, with ambitious targets for October set at 18,000 units.
However, dealers have indicated that entry-level variants of the Freedom 125 experienced a price reduction of INR 5,000 during the festival season due to slow demand. Sharma clarified that the price cuts were not merely festive discounts but a strategic move to boost sales amid a competitive landscape.
As production ramps up aiming for 30,000 units per month in the current quarter and 40,000 in the next Bajaj is marketing the Freedom 125 as a cost-effective alternative, claiming a 50% reduction in fuel costs compared to traditional petrol bikes.
Conclusion: Bajaj’s Strategic Moves
Bajaj Auto’s proactive approach in the electric two-wheeler market reflects its commitment to innovation and market leadership. With the anticipated launch of the new Chetak models and an expanded distribution network, the company is poised to strengthen its foothold in the e2w segment. As competition intensifies, Bajaj’s focus on enhanced product features and affordability will be crucial in navigating the evolving landscape of electric mobility.
In summary, Bajaj Auto’s dedication to enhancing its electric portfolio, alongside its strategic expansion into CNG bikes, underscores a broader trend toward sustainable and economical transportation solutions. With upcoming innovations on the horizon, the company is well-positioned to adapt to the changing needs of consumers in the electric two-wheeler market.
