Gogoro co-founder and CEO Horace Luke wants to “move forward” in India even as the Taiwanese company faces challenges in its home country.
India’s potential, it seems, is just ripe to be ignored and not just because it is the world’s largest two-wheeler market, with 15–20 million new two-wheelers hitting the roads every year. Luke also sees the world’s most populous country as a launch pad to accelerate its global expansion into other markets. Not a bad tactic, given that India is already on a spree to become a competitive manufacturing hub for all major international brands and products, from smartphones to satellites.
Earlier this month, Gogoro made its first commercial foray into India with the introduction of its battery-swapping network and smartscooters following pilots and millions of dollars of investment in the country. Speaking on the sidelines with Luke at the company’s event, it’s clear his ambitions extend beyond that initial debut.
Founded in 2011 by former HTC executives Luke and Matt Taylor, Gogoro bills itself as the Android of all electric vehicles. It offers its proprietary technology to other car manufacturers alongside selling its own branded battery-swappable scooters. The company already operates in markets such as China, Indonesia, Singapore, Israel and the Philippines — alongside its home country of Taiwan.
The company has chosen India as a strategic market from where it can reach many new users and enter new markets, starting with the neighboring country of Nepal, Luke said during the company’s launch in New Delhi.
The new developments follow Gogoro’s previous announcements in India, including an early battery swap pilot in Delhi, a partnership with Belrise Industries to invest a total of $2.5 billion in Maharashtra to build the battery swap infrastructure and network in the western peninsula . state and a $25 million investment in electric fleet management startup Zypp Electric.
Gogoro is in discussions with various local and global players to expand its operations and presence in India, Luke said without naming names. The company already works with domestic manufacturers to produce its components locally, which it currently assembles at a facility in Maharashtra in partnership with Foxconn. It is also looking to partner with Indian and global car manufacturers that can develop its technology, helping to grow its business in the country.
The company has about 11 vehicle manufacturers in Taiwan that make vehicles of different sizes and configurations based on its standard battery size, the executive said. These include Suzuki, Yamaha and Aeonmotor among others. He mentioned that some of these may come to India along with Gogoro’s swappable battery technology over time.
“Everyone is waiting for me to bring the network,” Luke said without revealing specifics. “Once the network is up and running, they will [partners] bring to their ability and potential’.
In April 2021, Gogoro partnered with Indian two-wheeler giant Hero MotoCorp to roll out its battery swapping network in the country. However, this agreement did not bring any results.
When asked how Gogoro will use its partnership with Hero MotoCorp and why it didn’t choose the local car maker for its debut and instead introduce its own range of smartscooters in the country, Luke shared a tentative answer and said that the top management of Hero MotoCorp did. wishes him good luck before the launch.
“Theirs [Hero MotoCorp] The brand and the company as a whole is very B2C focused… As we start with a B2B focus first, we keep them up to date with everything that is going on,” he said. “We are an open platform. One day, they will be ready [to] start a vehicle using our system. But it’s really a chicken and egg thing [situation]. I have to prove that there’s a platform that’s ready before they can actually come in, come in and do that.”
It imitates the Taiwan model
Gogoro plans to emulate its growth in Taiwan in India, opening 30 stations in Delhi by the first quarter of 2024. The company started its journey in Taipei with the same number of stations, but has since expanded to 12,500 stations serving around 600,000 vehicles throughout Taiwan. It is open to making many more investments in India to reach this level and grow even more over time.
“If you think about Pan India, we’re talking about several billion dollars easily by 2030-2032,” Luke argued.
It told reporters at the launch that Gogoro’s battery-swapping system accounts for 93% of all electric vehicles in Taiwan — about 80% of which use its own branded vehicles. The company is not limited to two-wheelers in its home country but also offers the battery replacement technology to auto-rickshaw racing players.
However, Gogoro’s growth is stagnant and falling even in Taiwan, as Luke admitted to TechCrunch.
Inside recent earnings report [PDF]the Nasdaq-listed company reported a 10.2% year-over-year drop to $91.8 million, resulting in a net loss of $3.1 million, from net income of $56.4 million in the same quarter last year.
He pointed out that there are two reasons why there is a decline in its finances and the abandonment of its activities in Taiwan. First, he said, it was due to a lobbying effort against the speed of electric vehicle adoption after the 2020 election. Second, the country took some time to bounce back from the COVID-19 pandemic.
“Taiwan has always been a pilot for us,” Luke said. “It’s always been a market where we’ve used to develop the technology, develop the system so that when we come to India, we’re ready. And that’s where the tipping point is now.”
He compared that petrol in Taiwan has been subsidized to the level available at an average price of 0.85 cents per litre, significantly lower than the average price of $1.4 per liter in India, above the global price of $1.22.
Although Gogoro is optimistic about its launch in India, the country has a relatively small market for EVs, accounting for only 3.7% of the country’s total car market. Electric scooters in the country account for 90% of total EV sales, but this is only about 5% of the total two-wheeler market. The Indian government has allocated billions of dollars in subsidies and rebates to attract manufacturers and passengers for EVs. However, these advantages remain in effect only for a short period of time and some disruption due to changes in their structure has recently been observed in the electric two-wheeler market.
However, Gogoro – similar to other players in the EV market – is bullish since the Indian government has targeted 30% electric vehicle adoption by 2030. Gogoro’s approach of considering India as a manufacturing hub will also attract the government and help the company shift some of its production from China and enter new markets.
It’s important to note that although Gogoro’s revenue fell significantly last quarter, the battery exchange service continued to grow, with revenue of $33.6 million, up 10.4% year-over-year. As the company is looking to partner with other vehicle manufacturers in India on battery-swapping technology, it could be a mutually beneficial move for both Gogoro and the auto players. Indian auto players are actively looking for solutions to reduce charging time and provide efficient alternatives to ICE vehicles. By providing its technology to vehicle manufacturers, Gogoro can take advantage of this need and increase its revenue from the battery exchange service.
A recent report jointly produced by Bain & Company and Blume Ventures forecast that battery-less electric two-wheelers can reduce the initial cost of vehicles by 40-50%, attracting price-sensitive Indian customers. However, he also warned that building a battery exchange ecosystem in India will be difficult in the short term and suggested maintaining a battery exchange inventory for top SKUs across all manufacturers, identifying customer segments to target and creating partnerships with “wall” system support of exchangeable batteries.
One investor told TechCrunch that to really succeed, the market needs interoperability and standardization in battery swapping, similar to how we have USB-C in phones today. But for Gogoro, it’s just the beginning to explore how big a step it can make in the overall electric vehicle market with its available battery swapping solution.
“I have a whole ecosystem to bring in. It took us a while to get ready and it will take us a while to get on. And I’m not kidding anybody that this thing is going to happen overnight,” Luke said. “India is a huge place. There are many different use cases. The price-performance that people are asking for is very high… So making more of the components and making more of the parts in India, with our Indian suppliers, we will definitely start and then more and more localization would definitely help.”
