Bajaj Auto Targets 80,000 Monthly Chetak Scooter Output

Bajaj Auto Targets Higher Chetak Electric Scooter Production

Bajaj Auto plans to increase monthly production of its Chetak electric scooters to approximately 80,000 units by the fourth quarter of FY27, up from slightly more than 62,000 units currently. Joint Managing Director Rakesh Sharma outlined the target following the company's second-quarter FY27 results, explaining that customer demand continues to exceed available production capacity. The company has restored manufacturing operations to full capacity following earlier supply chain disruptions, but additional capacity improvements remain necessary to address the demand shortfall. Bajaj Auto is also assessing locations for a sixth manufacturing plant to support future growth in electric scooters and premium motorcycles.

Chetak Production Recovers From Earlier Supply Chain Disruptions

Earlier supply interruptions had restricted Chetak production to approximately 40,000 scooters per month, despite available manufacturing capacity of 60,000 units. This created a monthly shortfall of around 20,000 scooters and limited the company's ability to meet customer requirements. Sharma confirmed that production has returned to full capacity, although demand continues to exceed current output. The company is now focusing on debottlenecking its manufacturing operations to increase production without relying solely on its existing throughput. The planned improvements are expected to be completed during the January-March 2027 quarter, bringing monthly production closer to 80,000 units and addressing a larger share of current demand.

Bajaj Auto Evaluates Locations for Its Sixth Manufacturing Plant

The capacity challenge extends beyond electric scooters to include premium motorcycles and internal combustion engine products. To accommodate these requirements, Bajaj Auto is holding discussions with several state governments and evaluating potential locations for a sixth manufacturing facility. Sharma said a cross-functional team is examining proposals across India to determine the most suitable location for the proposed plant. The facility is intended to support the company's future growth across electric scooters and premium motorcycles, while also addressing constraints in its broader manufacturing operations. However, the company has not announced the plant's location, proposed investment, production capacity, or construction timeline.

Electric Scooters Could Capture Half of India's Scooter Market

Sharma expects electric scooters to account for a substantially larger share of India's scooter market over the next several years. According to figures he cited, electric vehicles currently represent approximately 25% of national scooter sales, and their share could rise to 50% over the next three to five years. He described this transition as a realistic possibility rather than an immediate outcome. Differences in regional adoption rates also indicate that market development remains uneven, leaving room for further growth in areas where electric scooters account for a smaller proportion of sales. The anticipated shift provides the broader demand context for Bajaj Auto's plans to expand Chetak production and its manufacturing capabilities.

Electric Scooter Adoption Varies Across Indian States

Regional sales patterns illustrate the differences in electric scooter adoption across the country. Sharma cited electric scooters as accounting for approximately 40% of scooter sales in Odisha and between 30% and 35% in Maharashtra, compared with 10% to 12% in Gujarat. These figures indicate that penetration levels vary considerably by state, although the cited data do not establish the reasons for every regional difference. Sharma also observed that electric mobility is extending beyond major metropolitan areas into smaller towns. At the same time, access to charging facilities in apartment complexes and concerns about vehicle range continue to affect purchasing decisions among some customers. These practical considerations remain relevant to the pace of market expansion.

Chetak Gives Bajaj Auto a Renewed Presence in Scooters

The expansion of electric scooter demand has particular significance for Bajaj Auto because the company exited the conventional scooter segment several years ago. Sharma explained that electrification created an opportunity for the company to reenter the market through Chetak. The electric scooter business has subsequently grown in scale, recording its highest-ever quarterly revenue of more than Rs 2,000 crore during the September quarter, according to the company's Q2 FY27 earnings disclosures. Chetak sales volumes more than doubled year over year despite supply constraints. These results demonstrate the commercial importance of the product within Bajaj Auto's electric mobility portfolio and help explain why increasing production capacity has become a priority.

Electric Vehicles Contribute Significantly to Bajaj Auto's Business

Bajaj Auto's broader electric vehicle portfolio includes electric two-wheelers and three-wheelers. The company recorded combined electric vehicle volumes of nearly 200,000 units during the September quarter, contributing approximately one-third of domestic revenue. The figures highlight the growing role of electric mobility within its business beyond the Chetak scooter alone. This scale also increases the importance of manufacturing capacity across the company's electric product categories. Although Chetak remains central to the scooter expansion plan, the company's wider electric vehicle performance indicates that its production strategy must accommodate demand across multiple vehicle segments. The proposed sixth plant is being considered in the context of these broader growth requirements, alongside constraints affecting premium motorcycles and internal combustion engine products.

Electric Vehicle Operations Become Margin-Accretive

Sharma said Bajaj Auto's electric vehicle operations, which had previously weighed on overall margins, had become margin-accretive. Chetak has achieved double-digit operating profitability, while the company's electric three-wheelers have continued to deliver double-digit margins. Sharma summarized the improvement by stating, "The more we sell EV, we are making money," while clarifying that Bajaj Auto does not separately disclose profit after tax for individual product businesses. The comments indicate that the electric vehicle portfolio is contributing positively to operating profitability rather than serving solely as a growth investment. However, the available disclosures do not provide separate product-level net profit figures, so the precise contribution of each electric vehicle business cannot be independently quantified from the reported information.

Higher Input Costs Test Operating Performance

The improvement in electric vehicle profitability comes amid increased input costs. Sharma said higher prices for commodities, polymers, and electronic components raised costs during the quarter. The company partially offset these pressures through pricing actions, stronger export realizations, and a richer product mix. Bajaj Auto reported standalone revenue from operations of Rs 20,003 crore in Q2 FY27, representing a 34% year-over-year increase. Net profit rose 35% to Rs 3,354 crore, while EBITDA margin improved to 20.9% from 20.5% a year earlier. These results provide the financial context for the company's expansion plans, although the reported consolidated business trends do not establish the exact financial contribution of the proposed manufacturing facility or future Chetak capacity increases.

Bajaj Auto Plans Further Chetak Portfolio Expansion

Alongside manufacturing improvements, Bajaj Auto plans to expand the Chetak product portfolio over the next six months to address a wider range of customer requirements as electric scooter adoption increases. The proposed additions are intended to broaden the company's offering in a market where demand already exceeds its available production capacity. Product expansion and manufacturing debottlenecking therefore form complementary parts of the company's stated approach to growth. The production target of approximately 80,000 scooters per month by the fourth quarter of FY27 remains an important milestone, while the sixth-plant evaluation addresses longer-term capacity needs across multiple product categories. The company has not disclosed further details about the planned Chetak models or the timing of individual product introductions.

Industry Impact & Outlook

Bajaj Auto's planned production increase highlights how electric two-wheeler manufacturers must align manufacturing capacity, product availability, and profitability as customer demand expands. Raising Chetak output toward 80,000 units per month could help the company address supply constraints, while its proposed sixth plant could support longer-term growth across electric scooters and premium motorcycles if the project proceeds. The potential increase in electric scooters' national market share from approximately 25% to 50% over three to five years also points to a changing competitive landscape, although the pace will depend partly on practical adoption barriers such as apartment charging access and range concerns. The next important developments will be the planned Q4 FY27 production improvement, the company's location decision for its new plant, and execution of its Chetak portfolio expansion.

Frequently Asked Questions

What is Bajaj Auto's Chetak monthly production target for FY27?
Bajaj Auto aims to increase monthly Chetak electric scooter production to approximately 80,000 units by the fourth quarter of FY27. Current production stands at slightly more than 62,000 units per month, following a recovery from earlier supply chain disruptions. The company plans to improve manufacturing throughput through further debottlenecking during the January-March 2027 quarter. The target is intended to bring output closer to existing customer requirements, as demand continues to exceed available production capacity. The company has not indicated that the target represents a guaranteed production level.

Why is Bajaj Auto considering a sixth manufacturing plant?
Bajaj Auto is evaluating a sixth manufacturing plant because capacity constraints affect its electric scooters, premium motorcycles, and internal combustion engine businesses. The company is discussing potential locations with several state governments and has assigned a cross-functional team to assess proposals across India. The proposed facility is intended to support future growth across electric scooters and premium motorcycles. However, the company has not disclosed the investment amount, location, production capacity, or construction timeline. Its final decision will depend on the ongoing evaluation, and the available information does not confirm when the plant will become operational.

How quickly could electric scooters grow in India's scooter market?
Electric scooters currently account for approximately 25% of scooter sales nationally, according to figures cited by Bajaj Auto Joint Managing Director Rakesh Sharma. He indicated that penetration could reach 50% over the next three to five years. Adoption already differs significantly across states, with cited shares of around 40% in Odisha, 30% to 35% in Maharashtra, and 10% to 12% in Gujarat. Sharma also identified charging access in apartment complexes and range concerns as continuing barriers for some buyers. The projected increase is an expectation, not a confirmed market outcome.

Is Bajaj Auto's electric vehicle business profitable?
Bajaj Auto says its electric vehicle operations have become margin-accretive, with Chetak achieving double-digit operating profitability and electric three-wheelers continuing to deliver double-digit margins. The company's combined electric two-wheeler and three-wheeler portfolio recorded nearly 200,000 units in the September quarter and contributed approximately one-third of domestic revenue. Sharma also said higher commodity, polymer, and electronic component costs affected quarterly expenses, partly offset by pricing actions, stronger export realizations, and a richer product mix. Bajaj Auto does not separately disclose profit after tax for individual product businesses, limiting the available product-level financial detail.