A different perspective towards the Ather 450X pricing
I do a basic math for almost all big ticket purchases that I make.
The thought process while evaluating a purchase is simple, how much am I willing to pay monthly if I were to use the product and not buy it.
If I am willing to pay an all inclusive payment of Rs. 1,000 for a product per month, and its usable life is 5 years, then I can spend Rs. 60,000 on a product while buying it. Which should include all expenses including: Purchase cost, maintenance, running cost, lost interest over the life, and subtract resale cost.
For a product like the 450X, I would be willing to spend close to 4,000 per month(all inclusive) and I would estimate that the vehicle lasts 6 years without much need for service or repairs. The resale cost can be assumed at Rs. 40,000 (worst case)
(Now, this number can be different for different users. Given that I ride nearly 800km a month now, and I like riding overall. I wouldn’t mind paying 4,000)
Over the course of 6 years, I can spend around 4,000x12x6 = Rs. 2,88,000.
Now, the purchase price here is nearly Rs. 1,70,000 just for the vehicle on road.
Add a diminishing interest on the purchase at approximately 8% P.A. that I would have otherwise earned on the money put in.
This equates to approximately 4.4% fixed interest, for 6 years, = Rs. 44,880
Add to it a subscription equivalent to Ather One earlier, Rs. 10,000/year.
That brings the total cost to 170,000 + 60,000 + 44,880 = Rs.2,74,880
Factor in some damage and repairs at Rs. 20,000 on top of this and subtract the 40,000 resale value.
This brings our total to 2,74,880 + 20,000 - 40,000 = Rs. 2,54,880.
The total cost of ownership of the 450X is close to Rs. 2.55 Lakhs for a period of 6 years. And I am willing to spend nearly 2.9 Lakhs for a product like the 450X during the same course of time. Hence, the purchase for me can be justified.
Coming to the debate of Ather vs Activa vs Chetak vs iCube
While a lot of people have been comparing the 450X to the above mentioned vehicles, just because it’s either electric or it’s a scooter. This comparison to me honestly doesn’t make sense.
Just because the overall industry is at a certain price point or benchmark, doesn’t mean everything should compete with that.
There is a Suzuki Alto, and there is a Suzuki Ciaz, two vehicles from the same brand but miles apart in pricing. Here, I’m not even getting into different brands.
Unfortunately, in India, scooters were never seen as aspirational purchases. Something the first gen Ather 450 changed. It made scooters aspirational.
Here’s why you should buy the 450X:
- You want a great vehicle and can appreciate the finer details, features and the experience of riding it.
- You see it as a gadget, and something that brings a smile to your face every time you twist the throttle.
- You ride more than 30-40km a day, in which case you can even breakeven.
- You ‘want it’ more than you ‘need it’.
Here’s why you shouldn’t:
- You have been comparing the 450X to Bajaj or TVS just because they too are electric.
- You have been comparing it to an Activa/NTorq.
- You are on a budget and are just trying to save money by riding electric. You can buy a much cheaper to own and run alternative.
- You see it and would use it just like another scooter for getting groceries or dropping your kids to the bus stop.
The 450X is not the scooter for you.
Now, if your question is, "Why does the 450X cost so much?"
Simply put, there’s nothing else like it.
If your question is, "Why can’t Ather make a cheaper vehicle?"
Why would they? They have enough number of people who’d buy the 450X. They are still not trying to compete with the Hondas and TVSs of the world. They are trying to create their own market. Just like the iPhone did, or the AirPods did.
Who’d have thought a tiny wireless earphone could create a $15 Billion market for Apple?