Ola greets the Koreans

Ola is, in one word, India’s Uber. The company is created in Bangalore, India’s Silicon Valley, in 2010. An estimated 125 million Indians, Australians and British people use the app (unconfirmed source). Ola’s growth strategy includes geographical expansion, service additions and acquisitions.

Rather than self-developing, as the likes of Uber and Grab, Ola prefers to buy into new services and volumes. Examples are the Indian TaxiForSure (taxi services), Foodpanda (food deliveries), Ridlr (public transport ticketing), Vogo (scooter rent). On the other side of the investment table are Ola’s funding partners: Temasek, Softbank, Tencent, and a number of smaller investments from Indian banks. And that’s where Hyundai and Kia pop up.

Shared objectives

One of Ola’s objectives is to offer “mobility to a billion people”, but the company as other arguments for the Indian consumer: it pays attention to its female users, who are looking for a safe solution to travel around. Ola offers an SOS feature on its application that allows the user to keep friends or family informed about the trip. They also ensure the user that all drivers have gone through a background check and training.

In addition, Ola understands that part of the Indian challenge is pollution; city traffic in India is busy and complicated and doesn’t move; noise and emission pollution are real challenges. Ola has been looking into electrification, but the Indian OEMs are not really offering reliable solutions.

Hello Korea

USD 300 million was the price to hook up an OEM to the Ola ecosystem and the Hyundai / Kia group paid up. The Korean OEMs have already started the transition from car manufacturer to mobility and fleet services supplier. By acquiring stakes in Ola, they’ve bought themselves an app.

Similar to the Grab-Toyota deal, the deal is not really about cars. Kia and Hyundai will use Ola’s platform to develop and push EVs to the Indian market. In addition, the powerful Koreans slide in financial services, powered by their Capital branches. Leasing and consumer finance products are part of the deal.

Welcome India

In the same trend, Hyundai and Kia will be feeding their Indian service network with Ola cars. The Korean brands are already popular in India, especially the Hyundai Elite i20, Grand i10 and the compact cross-over Creta, occupying spots 7,8 and 9 of the best selling vehicles in India in 2018.

India is the centrepiece of Hyundai and Kia’s expansion strategy. The appeal of a single one billion car market and the ambition to become a major player in the global mobility market have come together in the Ola partnership. Question will be how two entirely different cultures will be working together. Let’s not forget that, only in 2018, Ola had already announced a collaboration with Indian manufacturer Mahindra & Mahindra to work on an EV strategy…