Understanding the dynamics of running an intercity electric bus fleet • EVreporter

Fresh Bus is currently operating 85 electric buses across 7 intercity routes. Excerpts from EVreporter’s exclusive interaction with Sudhakar Chirra, Founder & Chief Electric Officer, Fresh Bus. We discuss his entrepreneurial journey starting with AbhiBus (which scaled to ₹2,000 crore turnover; merged with Ixigo in 2021) and the dynamics of running an electric bus fleet for intercity operations.

Can you take us through your experience of building AbhiBus? How did you carry that experience forward in building the Fresh Bus platform?

I started AbhiBus in 2008, at a time when the bus booking experience was completely offline. To address this, we brought bus operators onto a Software-as-a-Service (SaaS) platform, integrated State Road Transport Corporations (SRTCs), and created a unified Online Travel Agency (OTA)—AbhiBus—where customers could easily compare operators, timings, and fares to book tickets seamlessly.

While we solved that problem and sold around 50 crore tickets—working with 3,500 operators across India—we kept hearing customer complaints about poor captain behaviour, lack of cleanliness, unsafe stopovers, and a confusing boarding process. That’s when I started thinking: why isn’t there a unified intercity travel experience like we see in flights and trains?

This idea took shape around 2016–17. By 2019, I launched Fresh Bus to address these issues and deliver a consistent, high-quality experience. Choosing EVs made economic sense—diesel prices were high, operators had little control, and fuel accounted for 55% of operating costs, compared to just 12–13% with electric buses. The savings could be reinvested in better services, such as real-time tracking and well-incentivised captains, ensuring passengers have a smooth and safe journey. With a deep understanding of the intercity space, I combined that insight with EV technology and a focus on customer experience, and that’s how Fresh Bus was born.

Could you share the current scale and route coverage of Fresh Bus?

We currently operate around 7 routes and have a total of 85 buses. Over the next couple of days, we will be inducting new buses on a daily basis.

We started with Bangalore to Tirupati as our first route, aiming to make the most of the Bangalore infrastructure. We launched routes from Bangalore to Chennai, Bangalore to Coimbatore, and Bangalore to Mysuru. The Bangalore to Hyderabad route will be inducted shortly.

What are the main differences between running an ICE fleet operation for intercity travel versus handling route planning and charging management for an electric bus intercity service?

If I compare ICE intercity operations—like running a diesel bus—private operators over the last 25 years haven’t invested much equity. Most got 110% bank financing, put buses on the road, fueled up at petrol stations, and relied on agents or OTA platforms. With such minimal upfront investment, they didn’t prioritise customer experience, leading to poor service quality.

This also resulted in an oversupply of ICE buses and fare compression. On the SRTC side, originally set up for social needs, they became politically driven—with freebies like free travel for women—further straining finances and preventing fare hikes. Together, this has left the industry choked and in turmoil.

Economically, a diesel bus costs around ₹1.3 crore, while an electric one is ₹1.7–₹1.8 crore. However, diesel’s operational cost is high—around ₹7 lakh per month just for fuel on a Hyderabad–Bangalore route. An electric bus can operate at nearly one-fifth of that cost.

EVs do require higher capital expenditure (capex) and charging infrastructure at terminals and midpoints. But with a long-term view, EVs make strong economic sense. To justify the capex, we focus on a superior customer experience and use data and tech to optimise routes, load factors, and operations. Electric buses combine better unit economics, enhanced customer experience, and tech-driven efficiency. That’s how we’ve built Fresh Bus, and that’s the future we believe in.

What are the key factors in choosing the OEM partners for intercity operations?

The first and foremost factor is the battery capacity and the battery technology being used. We choose from the top five manufacturers, like CATL, BYD, or Skysource. These are the companies we rely on, and they’re among the top battery manufacturers in China.

The size of the battery pack is critical. To run an electric bus, we estimate that 1 kilowatt-hour gives us 1 kilometre of range. Therefore, to run a route of approximately 400 km, we require a battery pack with a capacity of at least 425 kWh. That’s the minimum size we look at. If someone offers a bus with only a 250 kWh pack, it’s not useful for us—it simply won’t deliver the required range.

After battery size, the next factors to consider are the weight of the bus, build quality, and the OEM’s credibility. All of this matters because system engineering—from the motor to the powertrain to the BMS—affects the final power consumption. If the system draws more energy per km, then either we need to install more charging stations or reduce the distance, which isn’t viable. That’s our guiding metric—1 kWh for 1 km run—and that’s how we evaluate and select our OEM partners.

Can you share some insights into on-ground challenges in running the EV fleet?

The first challenge is range. We need solutions that can extend the distance—either 650 kilometres on a single charge or with interim fast charging. If that’s achieved, I think we can cover 90–95% of Indian routes. Without it, we must carefully select routes that fall within the current range, which is a major concern.

Also, enabling a charging station is a tedious task. We’re talking about 240 kW to 500 kW, or even 1.5 MW chargers. You need matching power lines, a transformer, LT panels, and then draw the power. It requires a huge Capex investment, which small operators can not afford.

Additionally, there’s still the demand issue—you have to fill the buses. Therefore, it requires careful consideration for any operators considering electrification.

Who are some of the electric bus OEMs you are currently working with?

We work with Olectra — they have partnerships with BYD and CATL. We also work with JBM from Delhi, Exponent (partnership with Veera), and Azad. These are the four companies we’re currently working with for our intercity coach buses.

Exponent buses use a 420 kWh battery. They have partnered with Veera Vahana for a 13.5-meter sleeper bus, and we are launching the first one with Fresh Bus. This 420 kWh battery pack will be charged using a 1.5 MW charger, and it will be fully charged in just 15 minutes. This allows us to cover longer routes (650 km) by utilising fast charging in between.

How does bus procurement for your operations usually work – Is it leased or bought?

We work with both models. We partner with Vertelo (a Macquarie Asset Management platform). They purchase the assets based on our OEM choice and then lease them to us. For charging, we partner with companies such as ChargeZone, Macquarie, and Statiq to enable exclusive charging for our use.

Are these CPO partnerships and installations exclusive to your operations?

Yes, the charging infrastructure is built exclusively for us. We choose the location, specify the configurations—such as the number and type of chargers—and everything is designed and implemented according to our captive requirements.

If the CPOs receive any additional demand from trucks, cars, or two- and three-wheeled vehicles, they can fulfil that demand. But the bus charging is exclusively for us.

The public charging network is still not very reliable. Most public chargers are only 60 kilowatts, so if I plug into a 60 kW charger, it would take hours to fully charge a bus. That limits the flexibility and freedom we need. We need to turn around a bus in about 40 minutes, so it makes sense for us to install our own charging capacity.

How much time does it take for an intercity operator like you to become profitable on their capital expenditure?

If you run it right, the complete asset can be recovered in about 41 months. We need to use technology to optimise asset utilisation and occupancy. With the right combination of occupancy and fares, and by utilising the vehicle efficiently—not just running routes A to B and B to A, but maximising yield wherever possible—you can turn the vehicle around to achieve better returns. With the right technology implementation, we aim to shorten that timeline even further.

You raised around INR 87.5 crores last year. Could you give us a rundown of your priority areas for spending this money?

When we raised the funds, we had 20 buses, and with this funding, we are taking the count to 100 buses. We will soon pursue Series B funding of approximately $30 million. The goal is to expand from 100 buses to approximately 1,000 buses within the next three years.

Is there any government support available to private bus operators?

The SRTCs—the government operators—were eligible for a FAME 1 capex subsidy of approximately INR 85 lakhs and around INR 55 lakhs under FAME 2. However, for private operators, there is no capex subsidy as such.

However, the Government of India has exempted the national permit fee, which is about INR 3 lakh per year. Some state governments encourage us through exemption from the home tax, which we typically pay quarterly. That gives us a relief of around INR 6.5-7 lakh rupees. Therefore, in total, private operators are receiving a subsidy of approximately 10 lakh rupees per bus per annum.

This interview was first published in the EVreporter June 2025 magazine.

Also read: E-bus service startup FreshBus secures INR 87.5 crore in Series A