Ola's Ambitious Cell Manufacturing Roadmap to Power India's Electric Vehicle Revolution

As India accelerates its transition to clean mobility, a homegrown automotive giant is making bold strides to secure its battery supply chain. Ola, the country's leading electric two-wheeler manufacturer, is building a state-of-the-art cell giga factory that promises to be a game-changer for the industry.

According to the details shared in Ola's DRHP and RHP materials, the factory will exclusively produce the advanced 4680 lithium-ion cells until at least Phase 2 of the project. This cylindrical cell format, pioneered by Tesla, offers superior energy density and structural benefits compared to traditional battery packs.

The capacity ramp-up plan for Ola's cell factory is truly impressive:

- Phase 1a (March 2024): 1.4 GWh

- Phase 1b (October 2024): 5 GWh

- Phase 2 (April 2025): 6.4 GWh

- Phase 3 (Mid 2026): 20 GWh

Once the Phase 2 expansion is complete, the factory will have the capability to produce an astounding 6.54 crore 4680 cells annually. This translates to enough cells to power 1.6 million high-performance electric two-wheelers, assuming a 4 kWh pack size with 40 cells per pack.

Interestingly, Ola has noted that the initial cell production capacity will be dedicated for captive use in its own electric vehicles. However, even after meeting the projected demand from its 2W business, which is expected to reach 100,000 units per month by the second half of 2025, the factory will still have a spare capacity of 14.5 lakh cells per year - approximately 26% of the total Phase 2 capacity.

To lead this ambitious project, Ola has assembled a team of top-notch professionals with experience in companies like LG Chem and Tesla. The company is also running lab-scale production trials at the plant and working on alternate cell forms and chemistries through its in-house R&D efforts.

Importantly, Ola has secured a robust supply chain for the critical battery raw materials. The company is sourcing key inputs like cathode, anode, and electrolyte from reputable global suppliers like Umicore, Epsilon, and Neogen, which have manufacturing facilities across Asia.

Umicore, a leading circular materials technology company, brings over 200 years of expertise in material science, chemistry, and metallurgy. Epsilon Advanced Materials, a subsidiary of Epsilon Carbon, is India's first integrated coal chemicals complex, providing a dedicated source of raw materials. Neogen, on the other hand, operates four state-of-the-art manufacturing facilities across India, with recent capacity expansions and acquisitions.

This vertically integrated approach not only ensures quality and reliability but also reduces Ola's reliance on China, which currently dominates the global battery materials market. OCTPL, Ola's cell manufacturing subsidiary, has stated that it has options to work with alternate vendors in case of adverse relations with China.

Interestingly, Ola has also collaborated with South Korean battery specialist Top Material to develop 2170 Li-ion cells with NMC chemistry, which are currently being used in Ola's existing electric two-wheelers.

The estimated capital expenditure for Ola's cell factory is significant, with Phase 1 expected to cost around $269 million (INR 22,499.70 million) and Phase 2 estimated at $147 million (INR 12,264.27 million).

As India accelerates its transition to clean mobility, Ola's cell factory will be a crucial piece of the puzzle. By 2026, this facility could meet a significant portion of the country's burgeoning demand for high-performance EV batteries, bolstering India's self-reliance in a strategic technology.

The road ahead is not without challenges, but Ola's unwavering commitment to innovation and localization is a testament to the company's vision. This project has the potential to cement India's position as a global leader in electric vehicle manufacturing and battery technology.