London revving up for Reva

Bangalore-based electric carmaker Reva Electric Car Company expects that the demand for its cars in London will more than double this year on account of the recently imposed congestion tax by the London municipal authority on fuel-run cars that cause pollution, including hybrid cars.

"We expect that the sale of our car will go up to 1,000 this year from 400 last year," said B Roy, senior general manager (Marketing), Reva Electric Car Company. London forms about 90 per cent of the total car market for the company.

The authorities charge congestion tax in the range of 5-8 pounds per vehicle. No congestion tax is charged on electric cars like Reva.

In addition, the authorities have also waived 12-15 pounds as parking charges on electric-run cars. London is the only city in the world charging congestion tax on vehicles.  

"In London, a Reva customer will be able to save 500-600 pounds on a monthly basis. In addition, with the purchase of every car the United Kingdom government paid the customer a subsidy of 1,000 pounds for adoption of non-polluting driving methods," said Roy.

Reva is a two-door hatchback, which could seat four persons. It is priced at £7,500 in the UK. In order to meet the demand for its cars in London, Reva is doubling its capacity at the company's Bangalore plant from the current 600 to 1,200 in this financial year.

Taking out London, Reva sells about 150-200 cars in a year in other markets like Japan, Cyprus, Malta, Norway and India. The company has sold about 75 cars in India last year.

However, the response is catching up, Roy said, adding, "Unlike conventional cars, it takes huge resources to make technologically sophisticated electric cars, a reason for the slow pace of capacity expansion."

The demand is growing from the environment conscious overseas markets. In 3-4 years, the capacity will be expanded to 6,000 cars per year. Reva derives technology from its US-based partner AEV, which is also an equity partner in the company.

Reva currently sells its cars in three models as Standard, AC and Classe. In India, Reva car is priced in the range of Rs 220,000 to Rs 260,000.