Ola Electric To Invest INR 7,600 Cr In TN For EV, Cell Manufacturing Facilities

Bhavish Aggrawal’s Ola Electric is set to invest a little over INR 7,600 Cr to set up manufacturing facilities in Tamil Nadu over the next five years to manufacture electric vehicles (EVs), EV components and batteries.

As part of the MoU, Ola Electric will set up an EV Hub which will also house vendor & supplier parks and the larger ancillary ecosystem for EVs at a single location.

The EV manufacturer plans to build two facilities – an advanced cell chemistry (ACC) plant under the Union government’s production-linked incentive (PLI) scheme and a four-wheel EV plant – in the southern state. The two plants would cost around INR 5,100 Cr and INR 2,500 Cr, respectively.

Ola Electric plans to build both manufacturing plants in addition to its current two-wheeler unit, at the same facility. The Tamil Nadu government has already allotted land to Ola Electric for that purpose as well.

Ola claims this EV Hub will be the world’s largest EV facility at a single location, spread across approximately 2,000 acres. The Hub would be located across the Krishnagiri and Dharmapuri districts of Tamil Nadu. Ola Electric currently manufactures its two-wheeler EVs at its Future Factory in Krishnagiri, Hosur.

“At Ola, our aim is to localise all critical elements of the EV value chain. Ola’s EV Hub would bring the entire EV ecosystem under one roof making us a much stronger vertically integrated mobility company across 2Ws, 4Ws and cells,” Ola CEO Bhavish Aggarwal said in the company statement.

The development comes after Ola launched its first lithium-ion battery, the NMC 2170, last year. The cell was developed at its Battery Innovation Centre (BIC) in Bengaluru, built with an investment of $500 Mn.

The EV unicorn said that it would focus on building local supply chains for new materials and components over the next decade. This would include motors, rare-earth magnets, power electronics, semiconductors, lithium processing, and electrode production from minerals like Graphite and Nickel.

After having seen a rapid decline through the early months of 2022, Ola Electric’s sales have rebounded since late last year. The startup’s total EV registrations stood at 18,220 units during January 2023, up 5% from 17,346 units in December last year.

Ola’s Four-Wheeler Ambition

Ola’s ambitious Tamil Nadu project also comes at a time when last August, Bhavish Aggarwal announced the company’s plans to foray into the electric four-wheeler market.

While the details have been sparse on the car, Ola Electric aims to put the first cars on the road by 2024. Talking about the specs of the car, Aggarwal claimed that it will be “one of the fastest cars built in India”.

The Ola electric car will go from 0-100 kph in 4 seconds, with a range of more than 500 kilometres per charge, and will feature an all-glass roof to deliver a drag coefficient of less than 0.21 (to maximise range and minimise drag), he claimed.

Amid all this, the Ola group of companies have been restructuring to focus on non-software engineering domains, while also trying to cut costs. As such, it fired 200 employees in September 2022 with software development roles, while stating that it plans to hire 3,000 people for other roles than software.

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Update | February 20, 2023, 12:30 PM

The story has been updated to include Ola Electric’s statement on the matter.