Mahindra and Mahindra (M&M) on Thurday announced a strategic alliance with Bengaluru-based cab service provider Ola. M&M will provide drivers associated with the start-up a comprehensive package including access to Mahindra vehicles at lower prices along with affordable insurance and financing options. The drivers will also have access to Mahindra’s after sales service facilities and pre-used car business known as Mahindra First Choice.
Anand Mahindra, chairman, Mahindra Group said at a press conference the alliance with Ola was like a marriage between two ecosystems to create a click and brick model and strengthen OLA’s value proposition for drivers.
“We want to make this an irresistible proposition for drivers. This initiative will have a positive social impact on on the lives of and prospects of at least 40,000 drivers, owners and the families. Shared mobility industry will grow and and the companies need to make their products as unique as possible,” added Mahindra.
To begin with, India’s largest utility vehicle manufacturer will make available its sedan Verito for drivers of Ola cabs. Subsequently, models like the KUV 100 will also be offered as a part of the alliance. By 2018 Ola Cabs is planning to empower 40,000 drivers across the country with the help of the Mahindra group.
The Mahindra OLA package will offer drivers vehicles zero down payment, subsidised insurance premiums, lower interest rates and other facilities available on the platform developed by Ola cabs.
The alliance will make Mahindra vehicles available to all the Ola cab drivers across the 90 cities in which Ola operates its business. It also provided M&M an opportunity to increase the volumes of Verito in the fleet services. Verito is one of the preferred vehicles by the fleet operators in the domestic market.
Bhavish Agarwal, founder of Ola Cabs said that a dynamic start up like Ola and conglomerate like Mahindra will be able to create a great value proposition for the ecosystem.
“The ride sharing concept will only grow in India and in the next five years Ola plans to grow ten times. We have to provide financing, insurance, reliable after sales and resale facilities to the drivers,” added Aggarwal.
This alliance also bodes well for the Mahindra First Choice which will also be able to sell second hand vehicles to the drivers of Ola. Anand Mahindra mentioned that Mahindra First Choice will have 1,500 outlets by year end from the 800 outlets at present.
Anand Mahindra during the launch of TUV 300 took notice of the fact that car makers will face tough competition from the cab aggregators as a section of the population do not wish to buy cars any more.
The alliance will look to create tailor made packages for particular drivers and Mahindra will also set up quick service centres across the country to provide quick and quality service to its customers.
“The rise of shared mobilty platforms will increase in the near future but the experience of owning and driving a car will lead to volume growth in the domestic market. As and when the road infrastructure improves people will buy cars to live the experience,” said Mahindra when asked about the whether the car ownership in the country will decrease with the rise in popularity of the shared mobility solutions.
