Hyundai and Kia have announced a big investment in Ola and a part of that investment will go into developing India-specific electric cars. Apart from building electric cars, the investment is also aimed at developing fleet and mobility solutions, infrastructure and “nurturing best in class opportunities and offerings for aspiring driver partners” for Ola.
Hyundai has not specified a timeline for the launch of its electric car for Ola. But before this India-specific electric car is rolled out, the South Korean carmaker will introduce a compact electric SUV in India in the form of the Kona Electric. The Kona Electric will not be manufactured in India but will be assembled here. It will have a range in excess of 200km and will be priced around the Rs 25 lakh mark, which is roughly the same as its starting price in the UK and the US.
We expect Hyundai-Kia to develop relatively affordable electric cars as a part of this investment in Ola. It won’t be surprising if Hyundai-Kia’s electric car is around the same size as the Santro or the next-gen Grand i10. We should also not rule out a more premium car based on this electric car for private use.
Hyundai was previously shying away from investing in electric car technology in India owing to the lack of clarity on policy. While the government is yet to give out a long-term strategy on electric vehicles, it has announced the second round of FAME scheme. Under the new scheme, a Rs 1.5 lakh incentive has been reserved for 35,000 electric cars that cost under Rs 15 lakh. The scheme is effective till 2021-22.
Like Hyundai and Kia, Maruti Suzuki is also developing an electric car for India based on the WagonR. But it is yet to announce how it plans to develop infrastructure for buyers and fleet operators. The WagonR-based electric car, the Tata Altroz EV (to be launched in 2020) and the India-specific Hyundai-Kia electric car are likely to fall under the Rs 15 lakh price bracket.
Like Hyundai-Kia, Tata is also investing in developing charging infrastructure for electric vehicles in India. While Tata already offers the Tigor EV to government-run EESL (Energy Efficiency Services Limited), the carmaker is yet to offer the car to private buyers. The only carmaker in India at the moment that offers electric cars to private buyers is Mahindra.
Check out the official press release announcing the investment below.
- Hyundai and Kia Invest $300m in India’s Largest Mobility Service Provider Ola
- Companies to collaborate on building a unique fleet and jointly explore mobility solutions in global markets
- Strategic partnership also aims to develop EVs and charging infrastructure customized for the Indian market
- Partnership to nurture micro-entrepreneurship opportunities by providing access to customized Hyundai and Kia vehicles as well as financing and insurance benefits for driver-partners
New Delhi, March 19, 2019 ― Hyundai Motor Group (the Group) and Ola ― one of the world’s largest ride-hailing platforms ― today announced a strategic partnership under which Hyundai Motor Company (Hyundai) and Kia Motors Corporation (Kia) will make their biggest combined investment to date, as part the Group’s continued efforts to become a Smart Mobility Solutions Provider.
The agreement will see the three companies extensively collaborate on developing unique fleet and mobility solutions; building India-specific electric vehicles and infrastructure; as well as nurturing best in class opportunities and offerings for aspiring driver partners with customized vehicles, on the Ola platform. Hyundai and Kia will invest a total of USD 300 million in Ola.
“India is the centrepiece of Hyundai Motor Group’s strategy to gain leadership in the global mobility market and our partnership with Ola will certainly accelerate our efforts to transform into a Smart Mobility Solutions Provider,” said Euisun Chung, Executive Vice Chairman of Hyundai Motor Group. “Hyundai will proactively respond to market changes and persistently innovate to deliver greater value to our customers.”
Bhavish Aggarwal, Co-founder and CEO of Ola said, “We’re very excited about our partnership with Hyundai, as Ola progresses to build innovative and cutting-edge mobility solutions for a billion people. Together, we will bring to market a new generation of mobility solutions, as we constantly expand our range of offerings for our consumers.” He added, “This partnership will also significantly benefit driver-partners on our platform, as we collaborate with Hyundai to build vehicles and solutions that enable sustainable earnings for millions of them, in the time to come.”
As part of the strategic collaboration, the companies have agreed to co-create solutions to operate and manage fleet vehicles, marking the Group’s first foray into the industry, as they expand operations from automobile manufacturing and sales to total fleet solutions.
The partnership will offer Ola drivers various financial services, including lease and instalment payments, while vehicle maintenance and repair services are expected to enhance customer satisfaction.
Hyundai, Kia and Ola have also agreed to coordinate efforts to develop cars and specifications that reflect the needs of the ride-hailing market (both users and drivers). Data accumulated during service operation will allow the companies to make constant vehicle improvements to better meet local needs and specifications.
Hyundai Motor Group expects to accelerate its transition from a ‘car manufacturer’ into a ‘Smart Mobility Solutions Provider’, as the partnership’s initiatives will allow it to engage in all aspects across the entire mobility value chain ― including vehicle production, fleet operation and mobility services.
Ola aims to create over two million livelihood opportunities in the mobility ecosystem by 2022. This partnership will help accelerate micro-entrepreneurship in India’s growing pool of aspiring driver-partners. Ola already hosts over 1.3 million partners on its platform and will further empower hundreds of thousands more, with access to tailored offerings across vehicles, financing, insurance and more, substantially bringing down the total cost of ownership for partners.