OLA EV Investment: Nearly a decade after its inception, Ola is trying hard to stay in the market. While the ride-hailing business has almost lost the perception battle, EV business is its last saving grace. Consequently, Dollars are flooding in.
Ola EV business’s new investment
Ola has decided to pump in $920 million (Rs 7,614 crores) in its EV business. With this money, more manufacturing units will be added, resulting in an estimated job generation of Rs 3,111 crores. These people will be working in a new electric 4-wheeler plant and an EV cell plant of 20 GW battery manufacturing capacity.
Read more: Looks like Ola wishes to sink even further
The battery manufacturing plant will get the lion’s share (nearly 66 per cent) of the proposed investment while Rs 2,500 crore will be used for the 200 acres long 4-wheeler plant. The 4-wheeler is speculated to debut by 2024, with capacity for running upto 500 km on a single charge. The proposed plants will be established in Tamil Nadu, which has released a special EV policy for bringing investments worth Rs 50,000 crore in upcoming years.
Ola will setup the worlds largest EV hub with integrated 2W, Car and Lithium cell Gigafactories in Tamil Nadu.
Signed MoU with Tamil Nadu today. Thanks to Hon. CM @mkstalin for the support and partnership of the TN govt!
Accelerating India’s transition to full electric! 🇮🇳 pic.twitter.com/ToV2W2MOsx
— Bhavish Aggarwal (@bhash) February 18, 2023
Ola’s topsy-turvy EV journey
Ola’s morale has been boosted by its performance in the EV segment during the last few months. Ola’s EV push initially met some serious roadblocks. It was late to deliver initial orders on time. Even when EVs were ultimately delivered to consumers, negative news about their failures, with some resulting in burning flooded the market.
Read more: Ola did everything right except one – Respect the fundamentals. Now it’s going bankrupt
Ola took its time and recovered from it. For the last 4-months, the company has been topping EV sales charts. While its competitors are swinging in the range of 10-15 thousand sales, the company constantly crosses the 20,000 mark. It is providing optimum push to India’s e-vehicle journey.
Amidst all this, Ola’s other business seems to have taken a back seat. The company owes its genesis to car-rides and rentals. It was a huge success to begin with. Over the time, new and new investments flooded the company. Sequoia Capital, Temasek, SoftBank are some of the most high-profile investors in Ola. Its founder Bhavish Agarwal used the sum to expand to other domains like fleet, food, financial services among others.
All of them could not add value and car rentals remained the top revenue generator. Even that took a hit during Covid-19 and Ola’s loss kept mounting up. Competition has also increased. Ola is changing its strategy to get a first mover advantage in EV, something which it had got in the cab business too.
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