Manufacturing of Electric Motorbikes Affordable for Everyone

Opportunity Snapshot

Motorcycle - Investment Opportunity in Manufacturing There is a huge gap between the growing market demand for two-wheelers and the supply of it in India, as well as abroad abroad. Image courtesy: Tristan Nitot, 2011, Flickr CC.

Investment Opportunity

I am looking forward to start up an E-Motorbike manufacturing unit that will produce quality vehicles to everyone's reach.

Nowadays, the fossil fuel is quite an outdated material to mobilize a vehicle. It has got a direct impact on our environment, resulting in global warming and making the Earth a less hospitable place to live in, for our subsequent generations. The cause to protect our mother nature, to provide a greener solution to the transportation industry and the necessity to create a feasible means of personal transportation has been a major driving force behind this project.

My product has got the same look and feel as that of a conventional gasoline powered Motor Cycle but it has some additional rich and sophisticated features. My product range is divided into three price categories.
1) Low Range (below $2000) - For daily office goers within city limits (100km/day of commuting).
2) Mid-Range (up to $2500) - For highway runners (200km/day of travel).
3) High Range (up to $3500) - For sporty and off-the-track riders (300km/day of riding).

The price might sound incredible for any E-Motorbike that are nowadays being sold 10 times higher in price than the above mentioned prices. This is the place where I have planned differently than others.

My plan is to go for a large scale of production to keep the price lower. I prefer to invest more on latest and ultramodern robotic facilities to have an outstanding impact on production scale. This will not only reduce the production timing but will yield in error-free product line.

My initial target includes the customers from the mid-level income group of all the developing countries. Being in India has got an added advantage of selling such vehicles that attribute to higher social standards. Once you give your customer the freedom from refuelling his/her vehicle, it's a block-buster hit product..! We will pitch our higher-end products to the rich countries where our higher range products will still be quite cheaper than anything in their market.

1) Low Range Model:
($2000 MRP - $1350 Manufacturing Cost)= $650
($1725 DP - $1350 Manufacturing Cost)= $275(Profit@20.37%)
($650-$275)= $375 (Margin@21.73% for Dealer, CNF etc.)
Any Taxes Extra.
2) Mid-Range Model:
($2500 MRP - $1750 Manufacturing Cost)= $750
($2075 DP - $1750 Manufacturing Cost)= $325(Profit@18.57%)
($750-$325)= $425 (Margin@20.48% for Dealer, CNF etc.)
Any Taxes Extra.
3) High Range Model:
($3500 MRP - $2250 Manufacturing Cost)= $1250
($2750 DP - $2250 Manufacturing Cost)= $500(Profit@22.22%)
($1250-$500)= $750 (Margin@27.27% for Dealer, CNF etc.)
Any Taxes Extra.

1st Fiscal Year:
A) Low Range: 500 Units [Revenue=275x500= $137500]
B) Mid-Range: 300 Units [Revenue=325x300= $097500]
C) High Range: 100 Units [Revenue=500x100= $050000]
Total Revenue in 1st Year: $285000

2nd Fiscal Year:
A) Low Range: 1500 Units [Revenue=275x1500= $412500]
B) Mid-Range: 800 Units [Revenue=325x800= $260000]
C) High Range: 500 Units [Revenue=500x500= $250000]
Total Revenue in 2nd Year: $922500 (Continued to NEXT Section)

Competitive Advantage


3rd Fiscal Year:
A) Low Range: 3500 Units [Revenue=275x3500= $962500]
B) Mid Range: 1600 Units [Revenue=325x1600= $520000]
C) High Range: 1000 Units [Revenue=500x1000= $500000]
Total Revenue in 2nd Year : $1982500

4th Fiscal Year:
A) Low Range: 7000 Units [Revenue=275x7000= $962500]
B) Mid Range: 3000 Units [Revenue=325x3000= $520000]
C) High Range: 1900 Units [Revenue=500x1900= $500000]
Total Revenue in 4th Year: $3850000

5th Fiscal Year:
Expected Boom in Sales (spreading up presence in Foreign markets and multiplication of Mfg. Units.)

5th Fiscal Year
A) Low Range: 17000 Units [Revenue=275x17000= $962500]
B) Mid Range: 6200 Units [Revenue=325x6200= $520000]
C) High Range: 3000 Units [Revenue=500x3000= $500000]
Total Revenue in 5th Year: $8190000

The rate of production thus is expected to increase @double to @Two and half times greater every year with the growing popularity in the market for 10 years. If the projected success probability works @50%, the total revenue amount in 10 years will become higher than $145920000, i.e. $14592000 per year (for 10 years). Now, imagine the fortune, if it works 100% successfully.

Basically there is no competitor except ourselves. Our goal is our competitor. However, some low-end Chinese manufacturers may pose a threat to our products. But our product quality and media campaign will provide us with adequate immunity. At the same time, we will ensure a strict code of conduct for our intellectual properties and will protect our technical know-hows with utmost importance.

Because, I do the same ordinary things, but in a different way. I have a colorful trail of successful project implementation and commissioning. I conducted many worthy projects of TV Broadcast Channels, Industrial Automation, Combustion Engine Designing, Hovercraft Technology Designing, Intelligent Drone Designing etc.

However, I have done a complete homework and prepared the blue-print for this particular project. This is going to be my Grand Project - Dream Project, that I am ready to take any leap for. I have a plan to introduce various rewarding benefits for the customers to make our product 'a must have' thing to them.

A product sustains in the market if the demand is continuous and the demand for two-wheelers is enormous in all the developing countries. So is in India too. We will continuously upgrade our technology and introduce newer and latest features in our products to keep the customers curious about our product.

Rationale for the deal

There is a huge gap between the growing market demand for two-wheelers and the supply of it in India, as well as abroad abroad. The reason is fuel price. An average Motor-bike user has to buy gasoline worth 3 to 4 times the amount he has purchased the Motor-bike within 5 years. This drawback in conventional Motor-bikes has restricted a large crowd from purchasing a two-wheeler. This is the gulf where we can build a strong bridge between the supply and demand.

Use of financing

Total Project Value: $10000000
Fund required: $8200000 (Total for 10 years)

1) Land, Infrastructure Development, Machinery, Tools etc. = 25%
2) Spares, Raw Materials etc. = 30%
3) Human Resources = 5%
4) Technology R&D = 10%
5) TVC & Other Campaigns = 20%
6) Reserve Fund = 10%
Total Fund Utilization = 100% (-10% Reserve)

This project requires investment in 3 phases.

1st PHASE: During first 3 months, 25% amount is required to establish the Production Unit.
2nd PHASE: During subsequent 1 month, 40% amount is required to procure the Raw Materials, Spares and to recruit Man-power.
3r PHASE: In the 5th month, the rest 35% amount is required for Ad Campaign, R&D and other formalities.

From 6th month onwards, the products will roll out.

Opportunity for the investor

The benefits an Investor can reap from this project have already been illustrated so far, if the details are carefully gone through.

However, a detailed profit sharing for the Equity Investment can be worked out later if any Investor is interested in this project.

The Debt Investors are assured with a total refund of their investment along with a 12% to 20% interest rate per annum for 10 years. If any Investor wishes a shorter period of refund, the minimum refund period will be 6 years from the commencement of product manufacturing and the assured interest rate will be 12% per annum. The refund process will be on quarterly basis.

However, all the business terms and conditions can also be negotiated during planning. Any Investor (hands-on or silent) is welcome.

I have not attached any Project Document for privacy reasons. A Complete Project Report can be shared with a seriously interested Investor only.

"Let's rock the market"

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