Reva to cash on subsidy in Punjab

Bangalore-based Reva Electric Car Company is planning to take its dealership to Chandigarh. The company set its eyes on the Chandigarh market after the department of science and technology, Chandigarh, announced a 15 per cent subsidy on purchase of battery-operated vehicles for Chandigarh residents. This will be the company's second dealership after Bangalore.

Talking to Business Standard, Reva marketing head Bhaskar Roym, who was in the city to finalise the dealership said, "We are in talks with local firms for dealership in Chandigarh, which will be finalised very soon. We hope to roll out the new dealership by March."

"The department of science and technology, Chandigarh, is the first agency in the country to announce a 15 per cent subsidy on purchase of battery-operated vehicles for personal use. In other states, subsidy on purchase of battery-operated vehicles is applicable only for public transport and not for individuals," he added.

The Ministry of Non-Conventional Energy Resources provides central subsidy of 33 per cent on the cost of the vehicle or Rs 75,000 per vehicle, whichever is less, for public transport.

He further added, "Already, we have done a survey in Chandigarh on the market potential there. It is an ideal place to launch this type of vehicle. It has a confined area as compared to other cities and our target segment is apt here, especially the ladies. The car will be priced between Rs 3,59,000-4,40,000 depending upon the model."

Currently, Mohali (Punjab) Traffic Police possess six Reva electric cars, while Chandigarh Police has three, while a few are also owned by individuals.

On expansion plans, he added, "The company has secured a $20 million private equity investment from Draper Fisher Jurveston (DFJ) and Global Environment Fund (GEF). We are using this investment to expand our business by increasing our production capacity and developing newer models. The company currently has a capacity to produce 15,000 cars per annum and with the new investment, production capacity will touch 45,000 cars per annum."

He added that the new plant with expanded capacity, which is coming up in Bangalore, will be operational by May 2008.

The company is exporting 80 per cent of its production to 21 countries including the UK, Norway, Spain, Belgium and Cyprus. We are seriously looking to expand in metros like Mumbai and Delhi, he added.