Ola Pilots Leasing for Electric Vehicles Amid Tense Rideshare Market

A lot has happened with Ola in India within the past few weeks, including approval for raising up to $100 million from existing shareholders, the State Bank of India beginning to refuse new loans for Ola drivers in Bengaluru, continued driver protests, and now the company is creating a new electric vehicle subsidiary to lease electric vehicles to drivers.

The subsidiary, Ola Electric Mobility Pvt Limited, is already running a pilot program for electric car leasing, but in the future, it plans to also offer leasing for two-wheeled electric vehicles, according to a published report.

“We shall be rolling out electric cars in top cities,” Bhavish Aggarwal, chief executive and co-founder of Ola, said in published report. “We will shortly identify the cities where the pilot project will be launched, and any decision to scale up the rollout of e-vehicles will be taken on the basis of the feedback we receive.”

Last year, the Bengaluru-based company announced a partnership with Indian automaker Mahindra Group, which currently manufactures electric cars in the country. This new entity follows on the heels of the State Bank of India preventing new vehicle loans for Ola drivers in Bengaluru, due to nearly a fifth of its loans in that area defaulting. All while Ola — and its main competitor Uber — try to determine the balance between growth and profitability, as rideshares are increasingly looking for new ways to diversify their product offerings.

For instance, Uber brought car leasing options to drivers in India back in December 2015, through its partnership with Mumbai-based Xchange Leasing, according to a published report, while Ola announced in January 2017 that it will revive its own leasing subsidiary, Ola Fleet Technologies, in order to increase the supply of cars and lure drivers with a new business model.

“I think you’ll see more diversification by these [rideshare] companies into related fields to expand their market opportunity,” Jan Dawson of Jackdaw Research, said in a published report. “So you’ll see more ridesharing services move into both general deliveries and more specialized areas like food delivery.”

In fact, Uber announced today that it has launched UberEats in India, where it will initially be available in Mumbai.

To learn more about the evolution of transportation, join us at the second annual Auto Finance Innovation 2017 conference, May 17-18 at the Hilton Bayfront in San Diego. Visit www.autofinanceinnovation.com to register or learn more. To request a media pass, contact Skylar Taylor at staylor@royalmedia.com.

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