Former Formula 1 Racer Narain Karthikeyan Accelerates Success with DriveX, a Used Two-Wheeler Start-up

India is the world's largest producer of two-wheelers, with over 20 million transactions annually, according to industry body SIAM. While the market for new two-wheelers has seen rapid growth, there is also a rising demand for used two-wheelers. However, the market for pre-owned two-wheelers in India is largely unorganized. Recognizing this market opportunity, Narain Karthikeyan, India's first Formula 1 racing driver, co-founded DriveX in 2020 with his childhood friend Christopher Anand Sargunam. Based in Coimbatore, DriveX aims to provide affordable mobility solutions to people.

DriveX initially started as a digital platform offering two-wheelers on a subscription model, enabling customers to purchase two-wheelers at reasonable prices. The platform also provided the flexibility of no down-payment and an all-inclusive monthly subscription fee covering vehicle access, maintenance, insurance, and tire and battery replacement. However, in 2021, the startup shifted its focus to refurbishing used two-wheelers and selling them to customers. This change was driven by the realization that consumers in Tier II and below cities preferred traditional ownership over subscription models.

The startup's model involves sourcing used two-wheelers through various channels, including retail customers, OEMs, and vehicle dealers. DriveX has established state-of-the-art refurbishment facilities called DriveX Technical Centers, which conduct rigorous evaluations using a 120-point checklist before certifying vehicles for sale. Customers receive warranty coverage post-sale.

DriveX also offers financial assistance by facilitating vehicle refinancing with instant loan approval, lower interest rates, and down payment options through mainstream NBFCs and banks. The company leverages proprietary technology for vehicle inspection, technical center management, location tracking, and platform operation.

The unorganized nature of the used two-wheeler market in India presented challenges to DriveX. Unlike fragmented dealers focused on maximizing margins, DriveX aims to create a transparent and sustainable ecosystem for refurbished two-wheelers, collaborating with stakeholders such as OEMs, banks, NBFCs, insurance companies, and service providers.

In August 2022, DriveX secured funding of Rs 85.41 crore from TVS Motor Company, resulting in a 48.27% stake acquisition in NMMSPL (Nkars Mobility Millennial Solutions Private Limited). Within a year of its launch, DriveX established two refurbishment centers and four fulfillment centers, achieving a 40% month-over-month growth. The company's revenue in FY 21-22 grew nearly 17 times compared to the previous year.

DriveX has ambitious plans, aiming to achieve retail transactions of over 7,000 vehicles annually, expand its network to 50 outlets across Tier I and Tier II cities, and operate five refurbishment centers. The company's revenue in FY 22 was around Rs 8 crore, primarily generated from the sales and servicing of pre-owned two-wheelers. DriveX also offers a franchise model alongside company-owned, company-operated (COCO) DriveX Technical Centers and showrooms.

As part of its expansion strategy, DriveX launched its first Technical Center in Coimbatore in February 2023, with plans to open similar centers in Hosur and Chennai. These centers are equipped to refurbish 350 to 400 two-wheelers per month.

Looking ahead, DriveX intends to establish technical centers throughout India, targeting retail sales of over 6,000 vehicles annually, and expanding its network to 50 outlets and five refurbishment centers across Tier I and Tier II cities. The company is actively hiring technical personnel and collaborating with training colleges to create job opportunities for ITI graduates.