Chetan Maini, Founder of Reva & Chief of Strategy & Technology, Mahindra Reva talks about the future...
Mahindra has expanded its presence in the electric car space by acquiring a majority stake in Reva. But more importantly, it gives the electric carmaker a chance to to turn into a mainstream auto major. Chetan Maini, Founder of Reva and Chief of Strategy and Technology, Mahindra Reva tells B&E the importance of the deal and the future of the acquisition...
B&E: Will Reva be forced to change after the controlling stake sale to M&M?
CM: In Mahindra, we have found a company with similar values and a shared commitment to sustainable growth. For Reva, to grow to the next level, we needed the resources and experience of a major automotive manufacturer. Mahindra Reva now has access to Mahindra’s vehicle development technology and distribution network, significantly enhancing its ability to launch a state-of-the-art electric vehicle for global markets. Under the new agreement, M&M will own 55.2% equity in Mahindra Reva by a combination of equity purchase from the promoters and a fresh equity infusion of over Rs.45 crores (approx. $10 million) into the company. The co-founders, Maini family and AEV continue to retain a significant share in the company
B&E: Expectations are that hereon, Reva will transform into a mainstream automaker. Many doubt it. Do you?
CM: Reva has the most experience with EVs globally and has used these customer insights to develop its 3rd generation vehicles. Reva is, in fact, in the fore front of EV technology, be it latest Lithium-ion batteries, intelligent energy management systems, fast charging, advanced telematics, integrated car infotainment that helps customer plan their journeys, patented ‘REVive’ technology that addresses the range anxiety of the customer or new and bold style in NXG. The announcement with Mahindra is recognition that although Reva is at the forefront of the global EV space from a technology perspective, the company will benefit from the resources and expertise of a major automotive company in order to continue to innovate in future and to scale delivering better products to more customers in more places.
B&E: With M&M’s top brass now taking over the day-to-day affairs at Reva, how do you see your role change?
CM: Post the buyout, the Board of Mahindra Reva is re-constituted under the chairmanship of Pawan Goenka, President – Automotive & Farm Equipment Sector, M&M and the new board includes members from the Mahindra Group, Maini family and AEV. Reva has a strong management team in place and will continue to operate under my aegis as Chief of Strategy and Technology.
B&E: Won’t a difference in vision create a state of conflict between the two auto companies?
CM: No. We are at the cusp of high growth and positive explosion of this space. As a growing company, in Mahindra we have found a partner who not only shares our vision of principled and sustainable growth but one that also has a reputation for good corporate governance. As a result of Mahindra’s investment, the new company Mahindra Reva will be able to scale, innovate and accelerate for greater electric vehicle access to consumers.
B&E: Electric cars in the Indian market – fact or farce?
CM: According to Frost & Sullivan, the EV market is set to grow to 1.2 million globally by 2015, being driven by factors such as oil price uncertainties, government support and technology breakthroughs. We expect improved government policies & incentives alongwith increased customer awareness to contribute to EVs becoming the favoured second car of the household, used primarily in the city for pollution free mobility.
Mahindra has expanded its presence in the electric car space by acquiring a majority stake in Reva. But more importantly, it gives the electric carmaker a chance to to turn into a mainstream auto major. Chetan Maini, Founder of Reva and Chief of Strategy and Technology, Mahindra Reva tells B&E the importance of the deal and the future of the acquisition...
B&E: Will Reva be forced to change after the controlling stake sale to M&M?
CM: In Mahindra, we have found a company with similar values and a shared commitment to sustainable growth. For Reva, to grow to the next level, we needed the resources and experience of a major automotive manufacturer. Mahindra Reva now has access to Mahindra’s vehicle development technology and distribution network, significantly enhancing its ability to launch a state-of-the-art electric vehicle for global markets. Under the new agreement, M&M will own 55.2% equity in Mahindra Reva by a combination of equity purchase from the promoters and a fresh equity infusion of over Rs.45 crores (approx. $10 million) into the company. The co-founders, Maini family and AEV continue to retain a significant share in the company
B&E: Expectations are that hereon, Reva will transform into a mainstream automaker. Many doubt it. Do you?
CM: Reva has the most experience with EVs globally and has used these customer insights to develop its 3rd generation vehicles. Reva is, in fact, in the fore front of EV technology, be it latest Lithium-ion batteries, intelligent energy management systems, fast charging, advanced telematics, integrated car infotainment that helps customer plan their journeys, patented ‘REVive’ technology that addresses the range anxiety of the customer or new and bold style in NXG. The announcement with Mahindra is recognition that although Reva is at the forefront of the global EV space from a technology perspective, the company will benefit from the resources and expertise of a major automotive company in order to continue to innovate in future and to scale delivering better products to more customers in more places.
B&E: With M&M’s top brass now taking over the day-to-day affairs at Reva, how do you see your role change?
CM: Post the buyout, the Board of Mahindra Reva is re-constituted under the chairmanship of Pawan Goenka, President – Automotive & Farm Equipment Sector, M&M and the new board includes members from the Mahindra Group, Maini family and AEV. Reva has a strong management team in place and will continue to operate under my aegis as Chief of Strategy and Technology.
B&E: Won’t a difference in vision create a state of conflict between the two auto companies?
CM: No. We are at the cusp of high growth and positive explosion of this space. As a growing company, in Mahindra we have found a partner who not only shares our vision of principled and sustainable growth but one that also has a reputation for good corporate governance. As a result of Mahindra’s investment, the new company Mahindra Reva will be able to scale, innovate and accelerate for greater electric vehicle access to consumers.
B&E: Electric cars in the Indian market – fact or farce?
CM: According to Frost & Sullivan, the EV market is set to grow to 1.2 million globally by 2015, being driven by factors such as oil price uncertainties, government support and technology breakthroughs. We expect improved government policies & incentives alongwith increased customer awareness to contribute to EVs becoming the favoured second car of the household, used primarily in the city for pollution free mobility.
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Source : IIPM Editorial, 2010.
An Initiative of IIPM, Malay Chaudhuri and Arindam chaudhuri (Renowned Management Guru and Economist).
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