The ride-hailing app, Ola, which is recently valued at roughly $6.2 billion, has begun working on consolidating its presence in the electric vehicle (EV) segment. Initially, Ola electric mobility programme was launched by the company; however, the program was closed down owing to some issues. After reopening the pilot programme as Mission: Electric, the ride-hailing firm has decided to escalate its platform similar to primary business by garnering funds from investors.
Presently, Ola electric has obtained $250 million from Japan-based conglomerate company, Softbank, to enhance its EV business in India, according to a media report.
Softbanks funding is considered one of the biggest investments in Ola Electric so far.
Investments are Important for Ola Electrics Expansion
When Ola Electric was reintroduced in 2018 under Mission: Electric, the company had set a target to add on 10 thousand electronic rickshaws, as well as electric auto-rickshaws, in the coming twelve months. Previously, the company decided to launch up to 1 million EVs on the road for facilitating people in mobility by 2021, as mentioned on the companys website.
Under Olas multimodel electric vehicle project, a wide spectrum of things are included namely buses, charging stations, auto-rickshaws, rooftop solar installations and battery swapping experiments. Besides this, the company is running two-wheeler and three-wheeler EV programs throughout the country.
To keep the operations running, the company raised money from various investment companies. Recently, it has raised $250 million from Softbank. Prior to this, it had raised INR 400 crore from other investors namely Tiger Global, Ratan Tata and Matrix Partners, as reported by daily news, TechCrunch.
After receiving funds from Softbank, Ola Electrics valuation has increased to $1 billion and thus the company has joined the unicorn club.
Government's Move to Switch to E-mobility
Earlier in June, the Indian government was planning to curb air pollution by ordering ride-hailing companies to convert 40 per cent of their fleets of automobiles into electric vehicles by April 2026.
Government bodies namely Niti Aayog officials, Ministries of Road Transport, Renewable Energy, Power and Steel, and the Departments of Trade and Heavy Industries and trade suggested switching to EVs.
According to the above-cited report, the government will plan to develop new rules for electronic mobility. As a result, the ride-hailing companies will have to begin converting their fleet into electric vehicles from the next year to attain 2.5 per cent electrification by 2021, 5 per cent by 2022, 10 per cent by 2023 and 40 per cent by April 2026.
Before the governments move, Ola was already working in this sector rigorously. Despite facing failure in the first phase, the company did not drop the idea and again ventured into electronic vehicle segment. By Softbanks offering, Ola electronic has not only become a unicorn but also the first electronic vehicle business to get into the unicorn club. With this pace, the EV company is far ahead of its competitors.