SEEING TRANSPORTATION AS AN ENERGY PLAY

SEEING TRANSPORTATION AS AN ENERGY PLAY

Cleantech

With Chetan Maini, India’s electric car pioneer, by its side, Lithium Urban Technologies is on the fast lane to revolutionise corporate employee transportation by deploying electric vehicles to move people from one place to another in the most (energy) efficient manner possible.

SANJAY KRISHNAN & ASHWIN MAHESH, CO-FOUNDER, LITHIUM URBAN TECHNOLOGIES
SANJAY KRISHNAN & ASHWIN MAHESH, CO-FOUNDER, LITHIUM URBAN TECHNOLOGIES

As we begin the interview with a formulaic question about the origins of Sanjay Krishnan’s maiden venture, Lithium Urban Technologies (Lithium) , he delves into a correlation between organic chemistry and the need for better transport services in the country. “Today, 20 per cent of the urbanites expenditure is towards official commuting, hydrocarbons (fuel and oil) are limited in supply, and you can’t control the cost of it. This shows that at some point in future, there will be need for transport to be powered by alternative sources,” he explains. But aren’t there existing solutions for sustainability in transportation? I enquire, and he adds, “While there are, they are viable under certain conditions, but viable all the same. So, the question was, can we find a market where they can be workable for a sustained period of time?” This turned out be a genesis for Krishnan’s business idea.


An auto maker will make only one model. While it could be efficient from capital perspective – even when, for example, reva was manufactured, it had a seating capacity of just an owner and driver. But, if the same car had to be used to transport 200 odd passengers, it needs to be tweaked in terms of usage, efficiency, utility and more. That’s where chetan maini’s expertise comes into play


To explain better, earlier, while renewable energy (such as solar) experienced high input costs and lower efficiency, over a period of time, due to enhancements in technology and higher penetration of renewable energy sources, it started seeing a reverse growth; wherein capital costs came down drastically and efficiency improved. “In other words, renewable energy became something that is determined by time and the reduction in costs was caused by advances in science, and not by trade (as is the case with hydrocarbons),” notes he. Therefore, banking on this observation, Krishnan, his co-founder, Ashwin Mahesh and team looked at transport as an energy business and the model revolved around how to move people from point A to point B while ensuring energy efficiency.

Today, how Lithium works is, it purchases cars from Mahindra Reva, Nissan, Renault, BYD and the like, customises the vehicle’s specifications (such as battery) to suit the transportation needs of each region it deploys it in, and hires drivers to operate the fleet. Currently, it has over 200 cars in its fleet and over 400 drivers operating it. With a presence in Bengaluru alone, it plans to enter into NCR, Pune and Hyderabad in the near future. “We are very focussed on B2B because our operating cost is low and this is a space where these cars can be operated for less than 200 kilometres a day,” states Krishnan.

Carving a Niche
As is the case with any other corporate transportation provider, Lithium’s primary challenges lay in ensuring transparency, compliance and safety in services. However, to carve a niche, it goes one step ahead by addressing an additional challenge of transportation costs as well. “As companies grow, they want to spend less on certain areas of operations, while also ensuring higher safety. So, we played on that positioning and worked to improve our technology to reduce costs and offer better prices to our clients,” explains Krishnan.

Since energy efficient transportation is still a niche space, Lithium sees competition more as an enabler than a restrainer. “Competition right now is good because once the model becomes mainstream, more vehicles that suit the sector’s needs will be sold, prices will reduce and consumers will benefit in turn. That being said, the industry still has a long way to go in terms of innovation,” he opines.

With a 5X growth in the previous financial year, Lithium, says Krishnan is financially healthy, and external investments is not on their cards now. However, Lithium holds a trump card with Chetan Maini, India’s electric car pioneer, as its advisor. Maini came on board Lithium in May 2016, to enhance the company’s technology offering. “We see transportation as an energy play. Hence, as battery technologies improve, we start thinking, how do we create newer forms of the electric car?” recalls Krishnan.


As ashwin, my partner, says, getting chetan maini on-board was like getting more electric miles out of the same battery


According to him, an electric car is very modular (like lego blocks, he quips). For example, the transportation requirement of each market is very different. If we take Bengaluru and Delhi, the trip lengths in the former is greater, which implies that the car needs a different battery and usage profile. “An auto maker will make only one model. While it could be efficient from capital perspective – even when, for example, Reva was manufactured, it had a seating capacity of just an owner and driver. But, if the same car had to be used to transport 200 odd passengers, it needs to be tweaked in terms of usage, efficiency, utility and more. That’s where Maini’s expertise comes into play,” explains Krishnan.

In the days ahead
While there are ample opportunities for the company to expand its services to the B2C space as well, Krishnan is clear that concentrating on corporate employee transport will be their main focus. In numerical terms, the company is looking to enter into three to four cities in the next three to five years, and bring four lakh vehicles into its fleet.

Day One: The First Customer
The beauty of being an entrepreneur is, every milestone, every inflection point is a day one for you. Specifically, let me recall a time when we won our first customer. We signed the customer when we had just rolled out operations, and began by operating four vehicles. Even for this, we did a pilot for one and a half months. We were thrilled, as though someone had given us an order for 4,000 vehicles. Later, the customer came back and said, “Either you can take over my entire fleet of 100 vehicles or just stop with four.” At that point, we weren’t ready for it – how do we get drivers? How do we manage 50 vehicles? What about finance? How do we price the product? We had to find an answer to all this within 10 days.

How did we solve it? Everyone in the team took up different pieces of the problem; some took over the process, some did strategy, some managed finance and pricing –it involved a lot of planning, thinking and execution. An important lesson we learnt here was; we won’t get everything right the first time but let’s at least make a start and reach an optimal stage before we know what amends to make.


ROLE MODEL 

There is no one role model I have. There’s something to learn from everyone. For example, my wife is one of my role models, for she always said, if you believe in something, just go ahead and do it. Another example is my co-founder, Ashwin. He would say: If you have to have to do something tomorrow, why don’t you start doing it today?