Electric Car Reva

On the Road to Reality Contd...

The recommendations included extension of the wheelbase to create more internal space and improvements in riding comfort. In 2001, the commercial version of Reva was launched in Bangalore. Reva was a two-door hatchback¹⁰, which could accommodate 2 adults and 2 small children. RECC did not adopt any marketing or promotional strategies as the company felt that the cars should be sold without the help of advertisements. Sudarshan said, "We mostly depend on public relations and use minimal advertising." The car was targeted at two-wheeler owners planning to buy a 4-wheeler. It was also positioned as an ideal second car for housewives, professionals and students. RECC also planned to sell the cars to tourist operators to be used as taxis.

Sudarshan said, "At Rs 0.40 per km, it is the cheapest car to drive around." RECC also promoted itself as an environment-friendly company. It promoted many environment-linked events on World Environment Day. The car also had the slogan: "I don't pollute when I commute."

Initially, RECC had only one company-owned showroom in Bangalore and planned to open more showrooms in some of the major cities across India. The company planned to launch the car in a phased manner, nationally. Depending on the demand, the company appointed dealers nationwide. In late 2001, RECC launched Reva in Goa. By January 2002, RECC appointed about 7-10 dealers in North India. In April 2002, Reva was launched in Delhi and Surat.

To promote the sales of Reva, RECC requested the state governments to exempt Reva owners from road tax and sales tax. This was granted by the Karnataka and Rajasthan governments. In September 2001, RECC entered into an agreement with ICICI¹¹ to provide loans to people planning to buy Reva.

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10] A hatch is a rear luggage access door with a fixed glass window. It is hinged at the top and hangs vertically or at
an angle. In a 'hatchback' car, the luggage area is integrated into the passenger compartment. Instead of a boot and
a horizontal stretch at the back, the roof slopes down at an angle of 45 degrees, with a small door or 'hatch' at the
back of the car.

11] Industrial Credit and Investments Corporation of India (ICICI) was a leading financial institution, which transformed
itself into India's first universal bank following its merger with ICICI Bank.

Case Details

Case Code : BSTR030
Themes: Mergers Acquisition and Takeovers
Case Length : 9 Pages
Period : 2001
Organization : Reva Electric Car Company
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Automobile & Automotive

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