Mahadevpura, a suburb of Bengaluru, is an extension of the traffic congested Whitefield area. While primarily known for its malls and IT parks, it is also an industrial area where commuters have to face gravel roads. It is in one of the corners of a bylane here that a hybrid technology startup called Altigreen Propulsion Labs resides. Like the name suggests, this is not a company filled with pseudo-green activists who go out on the road and ask the world to go green in the day while drinking several bottles of beer and making snide remarks on capitalism at the pub by night.
That being said, Altigreen does make the world greener, retrofitting conventional fuel-guzzling cars with hybrid technology, saving both the environment and money for the driver in the form of fuel costs.
The company has over 37 engineers calibrating their software box to make the batteries assist the drive train, which transfers power to the wheels of the car, and reduce the fuel consumed by the engine to propel the drive train. Remember that these are additional batteries installed in the boot of the car, and Altigreen’s systems do not tamper with the engine or the existing battery, factory-fitted in the bonnet, at all. At their facility, they are testing a sub-one ton truck and cars of several makes on their speed rollers, to check their ability to perform on retrofitted hybrid platforms.
Altigreen’s core team consists of people who have expertise in finance, controls engineering, aerospace, and software. It’s a deadly combination indeed.
“We are using our skills to solve a business opportunity. We are building cost-effective hybrid systems to assist fuel-based powertrains. This is the future of automotive technology in developing regions,” says Amitabh Saran, Founder of Altigreen.
According to World Health Organisation (WHO), Delhi tops the list of most polluted cities. The WHO continues to add that India is in the group of countries that has the highest particulate matter (PM) levels. Its cities have the highest levels of PM10 and PM2.5 (particles with a diameter of 10 microns and 2.5 microns). At the level of more than 150 micrograms, Delhi has the highest level of airborne particulate matter PM2.5, considered most harmful. These figures are six times more than the WHO “safe” limit of 25 micrograms. Uncontrolled vehicular traffic seems to be the primary reason.
A made in India story
Post his PhD, Amitabh had stints in NASA and HP. He also started two startups in the technical and online fields, and successfully exited both. Shalendra Gupta, the CFO and co-founder, has worked with engineering companies and capital markets for the last 25 years. Dr Lasse Moklegaard has a PhD in control engineering and is an expert in hybrid systems, and Dr John Bangura has a PhD in electrical engineer and has worked in large corporates in the aerospace industry. Both of them were working in the US when Amitabh invited them to join the company in 2013.
Amitabh stumbled upon the idea of building a hybrid for India in Gurgaon, at a golf course.
“I was unhappy that the only hybrid launched in India, in 2011, was an expensive Japanese make. But I then realised that these systems could be built by us,” he says.
Amitabh discussed the idea with Lasse, who was more than happy to build a platform for the Indian market. Next, Shalendra, who was an old friend of Amitabh’s, jumped in. Lasse then convinced Bangura to be a part of the startup, post which the two of them moved full time to India.
Amitabh moved the company’s base to Bengaluru because it had the best battery technology and engineering talent. “I studied various clusters across the country before placing my bet on Bengaluru,” says Amitabh.
Amitabh and team have caught on to a global trend, one that has not caught up in countries like India, or even in Asia. The world over, hybrids are becoming popular. Most hybrid cars in India are unaffordable, priced over $40,000. These expensive cars also have a battery that needs to be charged constantly.
According to PwC, sales of electric, plug-ins and hybrids will grow 433 percent to 2.2 million units by 2021 in Europe alone. This, the consulting and advisory firm says, is driven by a number of factors, including regulatory pressure. PwC adds that alternative fuel vehicles (AFVs) — including hybrids and pure electric — are gaining consumer acceptance in the European Union (EU), even in the face of decreased fuel prices.
Future Market Insights, a research and consulting firm, says that a hybrid vehicle uses two or more distinct power sources to produce motion. For example, distinct power sources can be a combination of diesel and electricity, fuel cell and diesel, or gasoline and electricity. The usage of the battery reduces emissions and improves utilisation of fuel.
The business model
Altigreen’s business model is to retrofit the software and the hybrid system into fleet vehicles. There are over three million fleet vehicles in India (sub-one ton trucks and taxis), and if you include passenger cars, there are over 10 million vehicles that are less than five years old. Altigreen charges Rs 60,000 to retrofit a vehicle. But in this, there is a government subsidy of 15 percent. “We are going after the B2B market and are creating a roadmap to also offer B2C services in two years,” says Amitabh.
The company has filed several patents. The USPTA has already approved one patent for the motor. This brings exclusivity to the company and the IP becomes valuable in case the company will be valued by automobile or technology companies,
“Going after the right market segment is very important for such a company,” says Naganand Doraswamy, Founder of IdeaSpring Capital.
According to ReportsNReports, a total of 549,000 electric vehicles were sold across the world last year. However, the total number of hybrids that sold last year was around 2.2 million vehicles.
Altigreen works with five corporates and has several fleet cars piloting on their hybrid platform. The company has plans to set up a factory to assemble their hybrid systems onto cars when their business scales up. The capacity of the plant is to be 20,000 units per month. Altigreen’s founding team has raised a total of Rs 20 crore from Jupiter Capital and Chetan Maini, the founder of Reva.
It has been a hard four years for the team as Altigreen is constantly in R&D. It is only now that they are going commercial.
More importantly, it is not one of those CNG systems built by a small-time mechanic, which connects to the car engine and destroys the driving experience. These are serious engineers building a system that works for car owners to bring down the usage of fuel. The average fleet car travels 150 km a day, which means that the driver spends close to Rs 600 per day and around Rs 20,000 per month. The hybrid saves at least Rs 5,000 on this total monthly cost. Altigreen guarantees their product for three years.
Other Indian companies in the space spending on R&D and yet to launch a product are Ather Energy, Tork and Ulraviolette. However, Altigreen sets itself apart because the plugin hybrid works best, not requiring the customer to buy a new car or bike. Just fix the product with the system and save on fuel. Keep in mind that the system does not touch the engine or the engine management system of the car; it is a separate system that will assist the vehicle.