Ather Energy's board has approved a capital expenditure of approximately Rs 122 crore to expand manufacturing capacity at its two production facilities, the company informed stock exchanges on Monday, as it moves to keep pace with demand for its electric scooters.
The expansion covers Ather's existing factory at Hosur in Tamil Nadu and the under-construction Factory 3.0 at Chhatrapati Sambhajinagar in Maharashtra. At Hosur, annual capacity will rise from 420,000 units to 495,000 units, an addition of 75,000 units, at an investment of up to Rs 58 crore. The company said the Hosur plant is running at 98 per cent utilisation at peak production, leaving little headroom under the current setup.
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Factory 3.0 will see a larger capacity increase, from a planned 500,000 units to 650,000 units annually, with an investment of up to Rs 64 crore. Both expansions will be funded through a mix of debt and internal accruals, according to the regulatory filing.
The Hosur addition is expected to be completed by December 2026, giving Ather a near-term boost in output as it heads into the new calendar year. The larger capacity addition at Factory 3.0 is slated for completion in the second quarter of FY28, aligning with the plant's broader commissioning timeline.
Notably, the Hosur investment also includes Rs 53 crore earmarked for a new battery production line, intended to support future demand and reduce dependence on external battery suppliers. That component of the project is expected to be completed by the third quarter of FY28, slightly later than the scooter capacity addition itself, suggesting the battery line is being treated as a parallel, longer-horizon investment rather than an immediate bottleneck fix.
The move comes at a time when India's electric two-wheeler segment continues to expand, with manufacturers racing to scale up capacity to avoid losing ground to petrol-powered rivals during periods of strong retail demand. Running close to full utilisation, as Ather's filing indicates for Hosur, can constrain a company's ability to capture festive-season and year-end sales, making timely capacity planning a recurring theme across the sector.
For Ather, the expansion also reflects a broader push towards backward integration. Localising battery production has become a priority for electric vehicle makers in India, both to manage costs and to insulate supply chains from volatility in imported cell and pack components. A dedicated battery line at Hosur would give the company greater control over a critical part of its manufacturing stack rather than relying solely on external suppliers.
Once both projects are completed, Ather's combined annual manufacturing capacity across Hosur and Factory 3.0 will stand at 1,145,000 units, a significant increase from the current combined capacity of 920,000 units. The company did not disclose specific sales projections tied to the expansion, but the scale of the investment points to continued confidence in demand for electric two-wheelers through FY28 and beyond.
