News · Mobility & Logistics

Ather Energy flags supply disruption from China

By Startup Enthusiast · 4 August 2025

What they do

Ather Energy makes electric scooters and sells them across India

CEO Tarun Mehta warned of a supply shortfall of up to seven days due to China's rare earth magnet export restrictions

The disruption comes as Ather ramps up production and dealer expansion ahead of the festive season

CEO Tarun Mehta flagged a supply disruption in Q2 FY26 due to China's rare earth magnet export restrictions.
The disruption may cause a shortfall of up to seven days' worth of supply, affecting the company's ability to meet dealer demand.
Production is not expected to halt completely, but wholesale volumes and retail sales may be affected.
Channel inventory is lean, so retail operations will also be impacted.
The company is working to reduce disruption through R&D and supply chain adjustments, and the gap is narrower than a few months ago.
The timing is challenging as Ather ramps up production and dealer expansion ahead of the festive season.
Mitigation options include partially assembling motors in China, transitioning to heavy-rare-earth-free magnets, or shifting to ferrite-based motor technology.

China's export restrictions on rare earth magnets are a geopolitical issue affecting many industries.
Ather's lean inventory makes it more vulnerable to supply shocks.
The disruption comes at a critical time as Ather expands its dealer network and prepares for the festive season demand.

Ather Energy designs and manufactures electric scooters in India.
It sells its scooters through a network of Experience Centres across the country.
In Q1 FY26, it added 95 new Experience Centres, expanding into Central India.
The company's next growth wave focuses on North India: Rajasthan, Bihar, Uttar Pradesh, and the Northeast.
New products expected include the EL platform and low-cost models.
Ather's Q1 FY26 revenue was Rs 644.6 crore, up 79% YoY from Rs 360.5 crore.
Its net loss in Q1 FY26 was Rs 178 crore, down 2.7% YoY from Rs 182.9 crore.
Margin improvement is supported by component cost optimisation and a rising share of non-vehicle revenue.

Ather plans to expand in North India: Rajasthan, Bihar, Uttar Pradesh, and the Northeast.
New products expected include the EL platform and low-cost models.
The company is working on mitigation options such as partially assembling motors in China, transitioning to heavy-rare-earth-free magnets, or shifting to ferrite-based motor technology.