Principle business model for the Auto Industry , remains
:
Selling
cars offline ( and displaying ‘
online ‘ )
But this is slowly changing
Speaking at the recent Global Mobility Summit, Shri
Nitin Gadkariji hinted that Tata Motors and Ashok Leyland could form an “
Operator Company “ on the pattern of London Transport Model
“
The government is ready to give " on a platter " all
necessary regulatory clearances to investors ready to run public transport buses on electricity
or alternative fuel…..
I
have urged manufacturers that apart from manufacturing buses, you open an Operator Company. You will get
business .”
[
https://timesofindia.indiatimes.com/business/india-business/gadkari-offers-approvals-on-platter-for-electricity-run-public-transport/articleshow/65723083.cms ]
Dear Shri Gadkariji ,
Whereas , citizens ( especially , of the metros ) would
be very happy if TATA and Ashok Leyland grab your offer and start Operator
Companies , you can only “ exhort “ them – but no more
But there is one company who you can give ( without it asking
), all those “ regulatory clearances “ ,
and ( more or less ) “ order “ it to turn itself into a Operator Company !
I mean , EESL which ,
·
placed an order for 10,000 electric cars (
Jan 2018 ) on TATA and M&M
·
has so far received ( 153 + 400 ) cars in 8
months
·
expects to receive the balance 9,000 + cars
in the next 7 months
·
getting ready to release the second order (
also for 10,000 cars ) by Dec 2018
·
plans to replace the entire Petrol / Diesel
car fleet of government ( 500,000 ) cars with electric cars in the next 5 years
Currently , EESL business model consists of ,
·
Outright purchase of these cars
·
Leasing out the same to different
government departments
This already makes EESL , somewhat of an Operator
Company !
After 5 years , when it leases out 500,000 electric cars to
Central and State governments , would that not make EESL the biggest “ Operator Company “ in the world ?
During the past few months, I have been urging EESL to change its
business model as follows :
·
Instead of “ buying “ , get these cars on “
Wet Lease “ from manufacturers
·
The “ sub-lease
“ to the government departments
Not only will this save thousands of crore of initial
capital investment but also save hundreds of crore of recurring operating /
maintenance expenses
But , even this can be improved upon by tweaking its
business model as follows :
·
EESL
will not “ buy “ electric cars but take it from the manufacturers on “ subscription
“
Here are some other options :
·
Govt departments buy “ Car Subscriptions “ directly from TATA / M&M etc , bypassing
EESL ( - no value addition by going through EESL )
·
EESL enter into a “ Rate Contract “ with
TATA / M&M etc , and government departments issue “ release orders “ with
copies to EESL
Several foreign car manufacturers ( notably , BMW –
Mercedez Benz – Porsche – GM etc ) , have started offering to the buyers , “
Subscription Deals “
A “ Car Subscription Company : CANVAS “ offers as
follows :
$ 375-1125 per month ( for 500 miles per month /
Additional $ 35 per month for another 350 miles )
Other References :
11 Sept 2018
www.hemenparekh.in/
blogs
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