Every business runs with the goal of earning profits. Thus, every company tries to achieve it by hook or by crook. However, a successful business is only the one, who interprets its future probability of sinking. To put it simply, Ola too as a company worked to gain profits. But unfortunately, it didn’t recognize its potential failure. And thus, it is now in a more tattered situation than ever before.
Rumours of OLA’s merger with Uber
Currently, ride-sharing companies, Ola and Uber are making rounds over the internet in light of their potential merger. However, both the company’s officials have categorically denied these reports. While, the facts clearly expose the opposite narrative.
Various media groupa have reported that Ola’s founder and CEO Bhavish Agarwal met Uber executives in San Francisco. The report indicated a possible merger between the two mega multi-national transportation companies.
Uber denied the media reports saying, “That report is inaccurate. We are not, nor have we been, in merger talks with Ola.” on the other hand, Ola’s CEO tweeted, “Absolute rubbish. We’re very profitable and growing well. If some other companies want to exit their business from India they are welcome to! We will never merge.”
Apart from this, Ola is in the process of laying out around 1000 employees, even when it ramps up the hiring for its electric mobility business. Highlighting the firm’s strategy, an Ola employee said, “The company is delaying the appraisal process of several employees who the company wants to fire – so that they resign.”
Interestingly, as reported by Economic Times, in a statement, Ola hinted that the company would not opt for a merger, but rather an acquisition to consolidate its position. It said Ola is among the most profitable ride-hailing companies in the world. “Hence, a merger of any kind is completely out of the equation. As a strong vertically integrated mobility company we will further consolidate our position by any acquisition in the Indian market, if at all.”
Though the Ola officials are trying to buzz off the viral news, however, that is unlikely to happen with the recurrent facts highlighting the dilapidated state of the company. Undoubtedly, Ola experienced a big boom during its initial phase. However, with the passage of time, it’s deluged with setbacks.
Covering the Ola journey
The biggest reason for Ola’s initial success was that it launched itself when people were fed up with the unending tantrums of auto drivers. The latter’s demand for unfair fares and their choice of travelling destination gave Ola an opportunity to flourish as the talk of the town.
From providing holidays and trips with Olatrips.com to changing the business model to Ola cabs, CEO Bhavish Agarwal was entirely too successful in attracting fame initially. It even accomplished some brilliant investments and funding for the company, which further took the business to greater heights.
However, any kind of greed is not good in the long run. With the incessant surge in aggressive funding, the company started to decay from its core. Soon, Ola started experiencing losses, which do not seem to end in the near future.
Ola’s recurrent falling can be made evident by its declining operating revenue. In the Financial year 2019, it recorded Rs. 8.9 billion of revenue. While in FY 2020, it was at Rs. 7 billion. Moreover, in FY 2021, it swamped even further by marking the revenue of a mere Rs. 3.7 billion.
As reported by TFI, Ola’s loss amounted to Rs 2,208 crore in the year 2020. Moreover, Ola’s revenue, an indication of how much it is popular among the masses, was registering a decline. It seems tough for Ola to get out of this mess.
Ola in tatters
The ride-sharing company is gradually getting more and more dampened by the sway of its failing strategies. It is evident with its shutting down of various domains of the business.
As reported by Economic Times in June, Ola shut down its quick commerce business ‘Ola Dash’ and used car sales business ‘Ola Cars’, signalling an end to its super app ambitions. These companies were not able to generate much revenue and thus it got shut down within just a year of its launch.
Apart from this, there have been various fire-catching incidents with Ola vehicles. Due to this, it struggled to sell its maiden vehicle, Ola S1 Pro, after a fire incident and multiple quality control problems started emerging. There have been dozens of videos for such cases.
Ola is already in a dilapidated state, and it is on the verge of sinking further. It is incessantly nose-diving, for which it will apparently be merging with its competitor. However, given the fact that it is not ready to mend its way, its revival is unlikely to happen.
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