Ola plans to double its fleet size of such premium cars in before the next year from the current 1,000
After concentrating on low- and medium-cost sharing mobility cars, leading taxi hailing aggregator Ola Cabs is giving push to the premium car segment with the introduction of BMW 3 Series for catering it to masses.
Ola plans to double its fleet size of such premium cars in before the next year from the current 1,000. The company had launched the service in May this year. The BMW 3 series cars will initially be introduced in Delhi, Mumbai and Bengaluru before being taken to other leading cities including Hyderabad and other cities, Ola's chief operating officer, Pranay Jivrajka, said in a media interaction. As per the MoU, the car maker will offer easy financing, aftersales support and assured buy-back for the cars.
At present, Ola Lux category cars, which include a mix of cars from the likes of Toyota Camry, Mercedes, BMW and Audi amongst others, are available only in the tony areas of Mumbai, Delhi-NCR and Bangalore. Ola Lux is available for booking at a minimum fare of Rs 250 and Rs 20-22 per/km.
According to industry experts, the luxury car market is just above 1 % of the total car sales in India, while it is around 5% in China and averages about 10% in the global market.
"In real terms, out of the 30 million cars in India, there are just 30,000 premium category cars, which is just 20% of those in China and about one-tenth of the global average," said Jivrajka.
Interestingly, when Uber had launched its service in India in 2013, its fleet of cars included a mix of Toyota Camry, Honda Accord, Mercedes E and S class and BMW 3 and 5 series. However, it later added smaller hatchbacks and sedans to become more 'mass' as a bulk of the business was in the affordable segment.
When asked whether offering BMW branded cars for shared mobility would dilute the brand, Frank Schloeder, president (acting), BMW Group India, said, "Luxury car segment hardly exists in India. So I do not think there would be any dilution. But we would like to increase the cake size."
As per industry observers, car manufacturers across the segment, apprehending a drop in their sales due to increase in shared mobility in major cities, are trying to play along the competition. Last month, Ola had signed a similar deal with automaker Mahindra & Mahindra (M&M). Under the alliance with Ola, M&M will sell over 40,000 units in the next two years. The partnership is expected to boost M&M's earning by around Rs 2,600 crore over the next couple of years apart from giving a new lease of life to Verito, whose sales are stagnating at around 200 units per month. The domestic taxi market is worth nearly around Rs 80,000 crore. Ola has also tied up with Japan-headquartered Nissan India for lease-purchase of cars by its drivers.
Ola's collaboration with automakers come in wake of similar tie-ups Uber had announced in June with rival Tata Motors to buy cars such as Indica and Indigo.
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