New Delhi, July 17: In order to give a boost to shared-mobility segment and finding niche solutions to cater to a large number of commuters, Mahindra group is all set to enter the cab aggregation business. Currently, the cab business is dominated by companies like Uber and Ola. Mahindra group chairman Anand Mahindra is of the opinion that the days of personal commuting may be limited, especially in congested cities and metros. Mahindra says that much of the industry’s growth will be fuelled by the car-hailing business.
The Chairman further added saying that electric vehicles will be the preferred choice for ride aggregators, as demand for petrol and diesel cars starts tapering off. The Chairman said with battery prices coming down, there would be a break-even between the conventional engine powered car and the electric car at some point in future.
On the sidelines of the Formula-E (electric) Racing, the $19-billion diversified Mahindra group chairman said that the reality is now at home and the firm will be a levelling off, or a sinking in the personal commuting segment. “There will be a dramatic shift in the customer segment. Overall, will it go down? Hopefully yes, as we want less cars on the streets,” he was quoted by TOI. The group is believed to look at incubating some of the companies that are already engaged in the business.
The firm believes that the segments such as plain-vanilla sedan are a complete threatened species as more and more individuals opt for shared mobility to save the hassles of new car purchase, insurance, maintenance, and parking. When the Chairman was asked if the firm was looking at anything on the lines of Ola and Uber or having partnerships with such companies, Mahindra was quoted by TOI saying, “We will look at every possibility.” He, however, added that unlike Uber or Ola, which burn tremendous amounts of cash to keep customers rolling in, Mahindra will look at niche solutions. The niche applications will do better. We will not burn cash.” The company aims not only to make the product like lowcost, spacious, urban electric taxis, but we also plan to invest in the ride-sharing space… we will look at partnerships and other investments because we think that the industry is going to be one of solutions, and not just products.”
The firm had signed a deal with Ola to supply 40,000 cars last year. Meanwhile, Hero MotoCorp has also expressed its intent to get into the category, while Ford India bought a stake in car-sharing company Zoomcar. Mahindra said, “The new philosophy of millennials and many others is that they want access to transportation, not ownership. They prefer ride-hailing or car-pooling… This will come first in dense urban clusters”. It has also been reported that the firm is all set to open its first auto manufacturing plant in Detroit this year. This will, however, be the first Indian car company that will have one in the countryto make off-road utility vehicles.