Judging by the title above alone, it’s clear that Hero MotoCorp has some very strong feelings about the Zero motorcycle. The Indian motorcycle giant cut the value of its investment in the California-based EV maker from Rs 2.4 billion (about $29 million) to just Rs 190 million (about $2.3 million) for fiscal 2026. This is a 92% markdown and a reported fair value loss of ₹2.2 billion (about $26.7 million). These aren’t exactly numbers you bury in a footnote.
But if you stop reading there, you’ll miss the bigger story.
Zero’s relationship with Hero is actually a few years old. The company first invested in the American electric motorcycle maker in 2022, before the two formalized a technology partnership in 2023. This was a very sensible arrangement. Hero brought massive manufacturing scale and one of the largest dealer networks on the planet. Zero has nearly two decades of experience in manufacturing electric motorcycles, batteries, powertrains and software. Together, they were to develop premium electric bikes under Hero’s VIDA brand, including concepts like the Project VxZ unveiled at EICMA.
Fast forward to today, and the partnership is still alive. However, investment has taken a very different path.
Photo By: Hero MotoCorp
The markdown didn’t start because Hero suddenly decided that Zero was useless. This happened because Xero raised new capital and Hero decided not to participate in the funding round. That decision reduced Hero’s ownership from 6.9% to just 0.8%, forcing the company to reevaluate its much smaller stake. Simply put, this was not simply an investment that was losing value. This was an investor deciding he didn’t need to buy a bigger piece of the pie.
This is the part worth paying attention to.
When companies think that a startup is absolutely critical to their future, they usually fight to retain their ownership during the fundraising rounds. The hero did the opposite. Rather than protect its equity, it accepted weakness. This suggests that the company no longer believes that owning a meaningful share of Xero is as important as having access to the technology it is already helping to develop.
And this is a perfectly reasonable strategy. Hero does not need to own 7% of Zero to benefit from its engineering expertise. If the collaboration continues as planned, Hero still gets access to years of electric motorcycle technology without having to commit much cash for an increasingly expensive minority investment.
It also helps that Hero has another EV bet that’s looking pretty healthy. The company owns about 30% of Ather Energy after investing about Rs 17 billion (about $205 million). The value of that stake is now estimated at more than Rs 130 billion (about $1.57 billion). Compared to that home run, Zero has become much less important as a financial asset.
So despite the scary looking article, this announcement is not actually about Hero abandoning electric motorcycles. It’s about the hero being more disciplined about where he wants to make his money work. The company appears perfectly happy to own less of the Zero, as long as it can continue to borrow from the company’s engineering playbook. For riders in India, and eventually, the rest of the world, who have been waiting for Hero’s next premium electric motorcycle, this is probably the only part that really matters.
