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New Delhi, October 27, 2024 — Bajaj Auto is accelerating its electric-vehicle strategy, targeting monthly output of around 80,000 electric two-wheelers by the end of March as demand for its Chetak scooter continues to outpace production capacity. Joint Managing Director Rakesh Sharma announced the goal during the company's second-quarter earnings review, saying supply chain snags that had crimped output are now resolved. Still, he added, demand remains ahead of what the factories can deliver.
The update offers a rare look at the operational realities inside India's fast-electrifying two-wheeler sector, where Bajaj is going head-to-head with Ola Electric, TVS Motor and Ather Energy. It also signals that established manufacturers with deep supply networks are moving aggressively to defend their turf against well-funded newcomers.
Bajaj Auto's current monthly electric two-wheeler capacity stands at roughly 60,000 units. But a recent component shortage forced the company's plants to operate at only 40,000 units per month, meaning some 20,000 scooters went unbuilt even as buyers were placing orders. Sharma said production has since returned to full capacity, describing the disruption as temporary.
The bigger fix is expanding capacity itself. Sharma explained that the company expects to de-bottleneck its existing lines during the January–March quarter, reaching approximately 80,000 units a month — a level he said would "be closer to what our current requirement is."
The timing is notable. India's festive season, a traditional peak for two-wheeler purchases, typically extends from October through early November, and electric scooters have become a prominent gifting and commuting choice. Missing that window even partially underscores how sensitive the EV supply chain remains, from battery packs to semiconductor-based controllers.
The Chetak nameplate carries deep nostalgia in India, where the original model was a beloved petrol scooter for decades. Bajaj revived the badge as an electric scooter in 2020, and it has since evolved into a modern, tech-forward product with a loyal following. That lineage gives Bajaj a brand advantage that newer entrants have had to build from scratch.
The demand arithmetic is compelling. In the July–September period, Chetak volumes more than doubled year on year, while EV segment revenue crossed Rs 2,000 crore — approximately $240 million — for the first time. That kind of growth has turned the electric scooter segment into the most watched battleground in India's automotive industry.
Perhaps the most significant news for investors was about profitability. Sharma said Chetak has now become a double-digit margin business, and the company's electric three-wheelers, previously solid performers, have improved further. In short, EVs are no longer a drag on Bajaj's earnings — they are adding to them.
"The more we sell EVs, we are making money," he said.
That statement carries weight beyond Bajaj. Many electric two-wheeler companies, including India's largest EV scooter maker by volume, have posted heavy losses as they scale production and invest in charging ecosystems. Bajaj achieving double-digit profitability on its own EV lineup suggests that scale, supplier relationships and established dealer networks can push the segment toward sustainable economics faster than some skeptics expected.
The capacity crunch is not confined to electric scooters. Sharma acknowledged that premium motorcycles and high-end bikes are also straining existing facilities, which is why Bajaj is scouting sites for a sixth manufacturing plant. Several state governments are in talks with the company, though a final location has not been confirmed. The new facility is expected to handle both EV and internal combustion engine production, reflecting the company's belief that both powertrains will coexist for the foreseeable future.
The broader plan is even more ambitious. Bajaj intends to raise its total annual manufacturing capacity from around 7 million vehicles to more than 9 million — an increase of over 25 percent — in the medium term. That expansion is designed to serve three growth engines: electric vehicles, premium motorcycles and exports.
Sharma put it plainly: "Not just Chetak, but also for premium products and high-end bikes, we are finding the capacity is getting challenged."
For readers outside India, Bajaj's expansion is a useful barometer for the global two-wheeler industry, which remains the largest vehicle segment in the world by unit volume. India has become the central arena for electric scooter adoption, and Bajaj, one of the country's leading exporters, is well positioned to push electric models into Latin America, Africa, Southeast Asia and Europe in the coming years.
The profitability milestone also raises the competitive stakes for Japanese manufacturers such as Honda and Yamaha. Honda, the world's largest two-wheeler maker, has announced plans to introduce an electric version of its popular Activa scooter in India — a direct challenge to the Chetak's home market. If Bajaj can build tens of thousands of profitable electric scooters each month, it strengthens the case that incumbents can win the EV transition without sacrificing margins.
There is also a supply-chain ripple effect. Each additional electric scooter requires battery cells, electric motors, power electronics and charging infrastructure. Bajaj's move to add tens of thousands of units of monthly capacity will influence procurement decisions across the component industry, potentially accelerating investments in local battery manufacturing and lithium-ion cell assembly.
The road to 80,000 units a month is not without obstacles. The recent supply chain disruption was a reminder that EV-specific components remain vulnerable to shortages, and any renewed disruption could push the target beyond March. Battery prices, too, remain a swing factor, though falling costs have helped improve margins across the industry this year.
The site selection for the sixth plant is another key variable. Decisions on location will hinge on logistics access, skilled labor availability and state-level incentives, and the announcement is expected in the coming months. Analysts will also be watching whether the plant is designed with flexibility to shift between electric and combustion output, given the uncertain pace of transition in different export markets.
For now, the focus is on execution. Closing the 20,000-unit gap between potential and actual production, hitting the 80,000 monthly run rate by March, and keeping EVs profitable while scaling are the near-term markers of whether Bajaj's aggressive EV bet is working. If the plan holds, Chetak production will have more than tripled from its recent run rate in roughly a year — a rapid ascent by any automaker's standard, and a signal that India's electric two-wheeler revolution is entering a new, higher-volume phase.
