SAERA ELECTRIC: ELECTRIC THREE-WHEELERS IN INDIA
CASE STUDY SOLUTION
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SYNOPSIS
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Nitin Kapoor, the managing director of Saera Electric Auto Pvt. Ltd. (Saera Electric), is excited to take
advantage of the opportunities brought about by the 2015 regulatory developments concerning electric
vehicles (EVs) in India. Saera Electric, established in 2011 by Nitin’s father, Vijay Kapoor, is a pioneer
and leading manufacturer of three-wheeler EVs in the country. Although Nitin, along with Vijay, has
n
successfully spearheaded the growth of Saera Electric despite several difficulties, the new favourable
regulatory developments are compelling Nitin to reevaluate Saera’s playbook. Cognizant of the new
tio
opportunities and challenges that lie ahead, Nitin and his team at Saera Electric are eager to chart out a
growth strategy for the company in India’s promising three-wheeler EV market. This case examines the
strategies adopted by Saera Electric to transform an innovative idea into a final product and explores the
lu
various opportunities and challenges associated with competing in a bottom-of-the-pyramid (BoP) market
segment within an emerging market context.
So
OBJECTIVES
• Examine the intricacies faced by companies operating within BoP markets, focusing on their distinct
challenges and the potential rewards.
• Explore strategic innovation in the context of BoP market segments, with an emphasis on the
significance of creative and effective solutions.
The Case Solution Starts From page 5
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ASSIGNMENT QUESTIONS
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1. What are the specific challenges cycle rickshaw pullers in India have faced before the introduction of
Mayuri e-rickshaws?
2. How has Vijay Kapoor leveraged his knowledge and experience in the Indian automobile industry to
design and launch the Mayuri e-rickshaws, considering the unique demands and challenges of the BoP
market segment?
3. In a competitive and price-sensitive BoP market, which key strategies have been implemented by Saera
Electric to ensure the commercial viability and sustainability of the Mayuri e-rickshaws amid increasing
competition?
4. How have the lack of key institutional intermediaries and institutional voids in emerging markets posed
challenges for Saera Electric during the development and marketing phases of its e-rickshaws? How
has the company navigated these hurdles?
5. Describe the market potential of Mayuri e-rickshaws in the Indian context. What are the strategies
adopted by Saera Electric to create competitive advantage in this market?
6. Considering the fragmented BoP market and growing competition, which long-term strategies would
you recommend Saera Electric pursue to maintain its market leadership and continue serving the needs
of rickshaw pullers in India effectively?
The Case Solution Starts From page 5
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pl
m
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2. How has Vijay Kapoor leveraged his deep knowledge and experience in the Indian automobile
industry to design and launch the Mayuri e-rickshaws, considering the unique demands and
challenges of the BoP market segment?
n
We can use the 4A
tio
framework as outlined by Anderson and Billou—availability, affordability, acceptability, and awareness—
to analyze the various challenge Vijay Kapoor faces in creating a strategic innovation for BoP segments in
India. According to the 4A framework that has been proposed by these authors, firms creating strategic
lu
innovations for BoP segments typically face the four challenges of affordability, acceptability, awareness,
and availability (see Exhibit -1). The instructor may encourage students to explore each of these four
So
elements, as described in the following sections.
Challenge of Affordability
This refers to the degree to which a company’s products and services are affordable to BoP consumers.
Because Vijay knows that his customers, the rickshaw pullers, are making a meagre income of $2.00–$4.50
per day and have very limited savings, he strategically prices the Mayuri e-rickshaws at $1200, well below
the price of diesel-powered autos, which typically cost between $2500 and $3500. But even a price tag of
$1200 is not affordable to rickshaw pullers, as they lack access to formal credit mechanisms. Vijay knows
very well that forcing rickshaw pullers to enter informal credit channels, like those offered by predatory
lenders, is going to hurt the rickshaw pullers due to exorbitant interest rates. Therefore, he formulates a
The Case Solution Starts From page 5
, EXHIBIT -1: CHALLENGES FACED BY SAERA ELECTRIC IN
DEALING WITH THE BOP SEGMENT
Challenges Elaboration Challenges for Saera Electric
Rickshaw pullers are making a meagre
The degree to which a company’s product income of $2.00–$4.50 per day and
Affordability and services are affordable to BoP have very limited savings. They also
consumers have no access to formal credit
channels.
The extent to which consumers and others EVs have been primarily designed as
Acceptability in the value chain are willing to consume, personal vehicles targeted at urban
sell, or distribute the products and services elites.
e
Awareness
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
CASE STUDY SOLUTION
e
pl
m
SYNOPSIS
Sa
Nitin Kapoor, the managing director of Saera Electric Auto Pvt. Ltd. (Saera Electric), is excited to take
advantage of the opportunities brought about by the 2015 regulatory developments concerning electric
vehicles (EVs) in India. Saera Electric, established in 2011 by Nitin’s father, Vijay Kapoor, is a pioneer
and leading manufacturer of three-wheeler EVs in the country. Although Nitin, along with Vijay, has
n
successfully spearheaded the growth of Saera Electric despite several difficulties, the new favourable
regulatory developments are compelling Nitin to reevaluate Saera’s playbook. Cognizant of the new
tio
opportunities and challenges that lie ahead, Nitin and his team at Saera Electric are eager to chart out a
growth strategy for the company in India’s promising three-wheeler EV market. This case examines the
strategies adopted by Saera Electric to transform an innovative idea into a final product and explores the
lu
various opportunities and challenges associated with competing in a bottom-of-the-pyramid (BoP) market
segment within an emerging market context.
So
OBJECTIVES
• Examine the intricacies faced by companies operating within BoP markets, focusing on their distinct
challenges and the potential rewards.
• Explore strategic innovation in the context of BoP market segments, with an emphasis on the
significance of creative and effective solutions.
The Case Solution Starts From page 5
, e
pl
m
Sa
n
tio
lu
ASSIGNMENT QUESTIONS
So
1. What are the specific challenges cycle rickshaw pullers in India have faced before the introduction of
Mayuri e-rickshaws?
2. How has Vijay Kapoor leveraged his knowledge and experience in the Indian automobile industry to
design and launch the Mayuri e-rickshaws, considering the unique demands and challenges of the BoP
market segment?
3. In a competitive and price-sensitive BoP market, which key strategies have been implemented by Saera
Electric to ensure the commercial viability and sustainability of the Mayuri e-rickshaws amid increasing
competition?
4. How have the lack of key institutional intermediaries and institutional voids in emerging markets posed
challenges for Saera Electric during the development and marketing phases of its e-rickshaws? How
has the company navigated these hurdles?
5. Describe the market potential of Mayuri e-rickshaws in the Indian context. What are the strategies
adopted by Saera Electric to create competitive advantage in this market?
6. Considering the fragmented BoP market and growing competition, which long-term strategies would
you recommend Saera Electric pursue to maintain its market leadership and continue serving the needs
of rickshaw pullers in India effectively?
The Case Solution Starts From page 5
, e
pl
m
Sa
2. How has Vijay Kapoor leveraged his deep knowledge and experience in the Indian automobile
industry to design and launch the Mayuri e-rickshaws, considering the unique demands and
challenges of the BoP market segment?
n
We can use the 4A
tio
framework as outlined by Anderson and Billou—availability, affordability, acceptability, and awareness—
to analyze the various challenge Vijay Kapoor faces in creating a strategic innovation for BoP segments in
India. According to the 4A framework that has been proposed by these authors, firms creating strategic
lu
innovations for BoP segments typically face the four challenges of affordability, acceptability, awareness,
and availability (see Exhibit -1). The instructor may encourage students to explore each of these four
So
elements, as described in the following sections.
Challenge of Affordability
This refers to the degree to which a company’s products and services are affordable to BoP consumers.
Because Vijay knows that his customers, the rickshaw pullers, are making a meagre income of $2.00–$4.50
per day and have very limited savings, he strategically prices the Mayuri e-rickshaws at $1200, well below
the price of diesel-powered autos, which typically cost between $2500 and $3500. But even a price tag of
$1200 is not affordable to rickshaw pullers, as they lack access to formal credit mechanisms. Vijay knows
very well that forcing rickshaw pullers to enter informal credit channels, like those offered by predatory
lenders, is going to hurt the rickshaw pullers due to exorbitant interest rates. Therefore, he formulates a
The Case Solution Starts From page 5
, EXHIBIT -1: CHALLENGES FACED BY SAERA ELECTRIC IN
DEALING WITH THE BOP SEGMENT
Challenges Elaboration Challenges for Saera Electric
Rickshaw pullers are making a meagre
The degree to which a company’s product income of $2.00–$4.50 per day and
Affordability and services are affordable to BoP have very limited savings. They also
consumers have no access to formal credit
channels.
The extent to which consumers and others EVs have been primarily designed as
Acceptability in the value chain are willing to consume, personal vehicles targeted at urban
sell, or distribute the products and services elites.
e
Awareness
pl
m
Sa
n
tio
lu
So
The Case Solution Starts From page 5
