Mahindra along with app based taxi service Ola Cabs announced to have signed a Memorandum of Understanding (MoU) to enter into a strategic alliance. The Indian automaker will help the cab hailing service to increase its fleet to over 40,000 cars across the country by 2018.
Through the alliance, Mahindra is aiming to provide overall vehicle sales financing of over $400 million (around Rs. 2600 crore) to drivers, along with a host of other benefits and convenient repayment options.
Speaking about the alliance, Anand Mahindra, Chairman, Mahindra Group said, "This is an initiative whose time has come, one that meets the current and future needs of Indian consumers, particularly younger ones who prefer shared mobility solutions. It also has a positive social impact on the lives and prospects of at least 40,000 driver owners, and their families. To me, this is an important strategic alliance for the Mahindra Group, one that I believe will change the contours of our industry, while giving us the first mover advantage in the fast growing Sharing Economy of India."
Ola's driver partners can now avail of an integrated 'Mahindra-Ola' package which will include Mahindra cars at special prices, attractive financing with zero down payment, and the best NBFC interest rates, subsidized insurance premiums, comprehensive maintenance packages, as well as exclusive benefits on the Ola platform.
The Mahindra and Ola alliance to offer improved mobility solutions
The alliance seeks to encourage micro-entrepreneurship amongst drivers, while offering improved mobility solutions for this generation and the next.
The Mahindra-Ola package focuses on financial inclusion by empowering driver partners who otherwise may not be able to invest in a car, to purchase one at a highly affordable price, and at up to zero down payment. It will also support drivers with accident insurance and scholarships for their children.
That said, this is not the first time a fleet company has tied up with an automobile maker. Just a few ago, Tata Motors announced a similar partnership with cab hailing app service Uber. Internationally, there have been several examples of such tie-ups with automakers even buying a stake in the cab service companies.
Considering that Mahindra's alliance with Ola isn't exclusive, the company could partner with other cab service companies like Uber in the future.
