Tata’s former chairman Ratan Tata has made yet another startup investment by investing undisclosed amount in the Ola Electric Mobility, a subsidiary unit of the ride hailing giant Ola. According to reports, Mr. Tata has made the investment in a personal capacity and not through his investment firm. The company plans to use the fresh capital infusion to propel its fundamental goal of building a viable electric mobility business in the country.
Responding about his fresh investment initiative, Mr. Tata issued a press statement,
“The electric vehicle ecosystem is evolving dramatically every day, and I believe Ola Electric will play a key role in its growth and development. I have always admired the vision of Bhavish Aggarwal and I’m confident that this will be part of yet another important strategic move into this new business area.”
Ola Electric Mobility came into existence only few months back, after it was carved out from its parent company. As a separate entity, it is currently operating several pilot projects such as charging solutions and creating commercial electric vehicles across two, three and four-wheeler segments. Via these pilot projects, the parent company Ola’s goal is to put 1 Mn electric vehicles on Indian streets by 2021.
Prior to the latest funding round, Ola Electric Mobility had raised INR 400 Cr from Tiger Global, Matrix India and others.
Tata’s association with Ola predates his latest investment initiative. In fact, he was one of the earliest backers of ANI Technologies Pvt. Ltd – the parent company of Ola. An investment backing from India’s most celebrated entrepreneur most certainly helped Ola in clearing the coast during those early days.
India’s Electric Vehicle Dream Faces Huge Challenges
With dirty air becoming a cruel reality across major Indian cities, Indian government is trying hard to give major push to electric vehicles. The Indian government recently unveiled three year subsidy program for electric vehicles that will cost the exchequer almost $1.4 billion. Electric vehicles have also received major thrust after prominent political parties included fight against air pollution as an important goal in their manifesto.
However, despite government’s noble initiatives, India’s electric vehicle dream appears to be more of a pipe dream. Especially the infrastructural deficiencies like the sheer lack of charging stations and the challenge of building robust network of stations is a monumental task. It is no less challenging task to make electric vehicle business a scalable and viable venture.