After e-vehicle initiative, Ola goes for an internal reshuffle for Drive

Topics Ola cab | Ola

After electric vehicle (e-vehicle) initiative, cab aggregator Ola is planning to divert a bunch of its ride-sharing resources within the company to Ola Drive, its new vertical for shared car. 

Ola Drive, launched last week, has been rolled out for users in Bengaluru and would be soon spread to Hyderabad, Mumbai, and New Delhi.  

The company claims it would build and scale up the service across several cities in the country and plans to host a fleet of 20,000 cars by 2020. According to sources within the company, it has been internally transferring a bunch of its executives from the main ride-sharing business into the new vertical over the past several weeks. It also intends to hire more people on-ground to track and manage the fleet of new cars that would be added to Ola Drive.

 “There has been a major reshuffle that has taken place over the past few weeks. The new division requires a different way of functioning and that is the reason a lot of internal transfers have happened. New people would be hired as well going forward,” says a senior executive who is part of the new team.

 
The company will also launch a subscription service, which would include a long-term ownership plan of its vehicles for consumers, but sources say those plans are still on the drawing board. The series of investments into Ola by original equipment manufacturers (OEMs), including Hyundai-Kia, might include providing fleet that would help it in adding cars to its self-driving fleet, the sources say. 

 “They plan to bring out the service in major metropolitans over the next few months. After the first wave of initial response, it might go ahead with plans for long-term car lease and other services. But that happens much later,” said a source close to the company.  

The tricky part, however, experts believe would be getting the tech right which is completely different from the one that powers a ride-sharing platform. According to experts, there are a lot many moving parts which need to be constantly monitored in car-sharing. 

“The car needs to be monitored for several things like daily upkeep, where all it is travelling, if it is being booked by any police or authorities, if it is involved in a mishap, among other things. It requires extensive human monitoring as well as solid backend tech,” says an industry expert who earlier headed a major transport firm. In ride sharing, the tech is different as it is more about connecting drivers to users and keeping an overall track of fleet on the platform. 

 According to Greg Moran, co-founder and chief executive officer of Zoomcar, for running a shared car business a company has to deal with a host of regulations and has to get a bunch of licenses to run a pan India business. This is very time consuming, he says.  

“There are actually quite a bit of regulations that one has to work through initially. Getting the licences is a time-consuming, challenging, and expensive process which can take several years. Technology behind self drive is very non-trivial. You need to have a significant investment in operations tech and IoT. 

 
There is quite a bit in technology that needs to be invested in it. The brand association in self drive is different from any other industry. There is a significant equity investment required, which is non-trivial. It is a dedicated invested focussed only on self drive,” he says.  

His company, which has been profitable for a better part of the year, is making money at transactional as well as car level. It has more than 75 per cent market share and is the dominant player in the business. 

 
“We expect to cross over a lakh vehicles in the next 18 months or so. We are very confident we will be able to build a market share of 85 percent,” the Zoomcar CEO says.


Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel