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Ola to invest Rs 5,000 crore in cab leasing business

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New Delhi, Sep 14 (PTI) : Taxi aggregator app Ola will invest Rs 5,000 crore in the coming year to expand its newly formed cab leasing business.

The Bengaluru-based firm has also roped in former LeasePlan India executive Rahul Maroli as Vice President (Strategic Supply Initiatives) to head the leasing business that will operate as a fully-owned subsidiary company.

Details of the subsidiary were not disclosed.

Under the programme, drivers can lease a car for a minimal initial deposit of Rs 35,000 and monthly lease payments (of about Rs 15,000) with an option to own the vehicle after a period of three years.

“This will open up opportunity for hundreds of thousands of drivers to turn entrepreneurs in the long run while giving them instant access to a stable income,” Ola said in a statement.

It added that the programme has a dedicated capital of over Rs 5,000 crore that will be infused for scaling up the leasing programme in the coming year.

“Up to Rs 5,000 crore of capital will be infused towards this programme in the coming year. Ola will be investing Rs 500 crore to begin with, and will raise funds independently for this subsidiary in the time to come,” it said.

Over 1,000 vehicles in Bengaluru, Chennai, Hyderabad and three other cities are already on road as part of the pilot, it said.

“For the pilot, a majority of vehicles were sourced from Maruti Suzuki India. Ola is in advance talks with car manufacturers and financial institutions to enable this model for over a 100,000 driver partners by the end of 2016,” it added.

By December 2015, at least 10,000 cars are expected to be on-road under the leasing model, Ola said.

“We believe that this first-of-its-kind leasing programme brings a unique benefit to driver partners to turn entrepreneurs. Rahul’s rich experience shall help us scale this business rapidly and in making this programme an industry benchmark,” Ola co-founder and CEO Bhavish Aggarwal said.

Comments

comments

  • FROM JOB-SEEKERS TO JOB-CREATORS ?

    How to turn 12 million persons entering our work-force each year from being job-seekers to becoming job-creators ?
    At the conceptual level , this was well-answered in BJP poll manifesto as :
    ” Encourage and empower our youth for Self Employment – incubating entrepreneurship as well as facilitating credit ”
    How to translate this policy into specific actions ?
    May be the clue lies in the following incidence :
    After getting a post-graduate degree in engineering from USA , when I returned to India in 1959 , my father took me to meet Shri Manubhai Shah , the then Minister for Industry in Union Government
    My father inquired if Manubhai could give me a job in government
    Manubhai answered :
    ” Chunibhai , I have no job for your son .
    Let him set up a factory and manufacture fractional horse power motors of which India is currently importing some 3000 per year
    We will ,
    > Immediately issue to him , an Industrial License
    > Allot him a factory-shed in Rajkot Industrial Estate
    > Give him a loan of Rs 5 lakhs to buy machinery ”

    56 years later , we are better organized / equipped to ” Institutionalize ” this pioneering thinking

    Here is my suggestion :

    * Role of MakeinIndia web site

    > On its web site , list 5000 products that we currently import ( with
    annual import bill / sources / ave landed cost etc )
    > Invite 1000 leading manufacturing companies of India , to make
    online selection of minimum of 5 items each, for preparing DPR
    ( Detailed Project Reports ) . Freely visible online database of who
    selected which items will avoid duplication

    * Role of Manufacturing Companies

    > Prepare and submit to Ministry of Commerce, at least 5 DPR by
    Dec 2016 . More the merrier ! Earlier the better !
    > Each report must carry , name of at least one bank which has
    accepted that as a ” Bankable Report ” , eligible for funding
    > Train at least 100 fresh engineering graduates in various
    manufacturing related functions under GET ( Graduate Engineer
    Training ) Scheme , each year

    * Role of Ministry of Commerce

    > Publish DPRs on its web site for free downloading

    * Role of Income Tax Department

    > Give 200 % tax deduction to existing manufacturing units for 2
    years , for employing fresh engineering graduates on their rolls ,
    under :

    ” Graduate Engineers Training Subsidy Act – 2015 ”
    ( to be enacted )

    This will motivate manufacturing units to impart manufacturing
    related experience to fresh engineering graduates before they
    venture to set up own MSME factories

    > Admit expenses incurred by manufacturing units for preparation of
    DPR ,under their CSR obligation ( 2 % of ave net profit for 5 years )

    > Exempt all GET Start Ups ( registered on eBiz web site ) from
    paying Corporate Income Tax for first 10 years of working

    > Exempt all GET Start Ups from GST payment , for 10 years

    * Role of Fresh Engineering Graduates

    > Get GET Training Certificate from employer companies
    > Download DPR from Commerce Ministry web site
    > Apply for funding to banks , attaching DPR and GET Certificate
    > Upon receiving Approval Intimation from bank , apply for various
    permissions on eBiz web site , quoting Bank Approval Number

    * Role of ASSOCHAM / FICCI / CII etc

    > Encourage their manufacturing member firms to take on the
    task of preparation of DPRs and follow up
    > Publish DPR reports on their web sites for free downloading
    > Constitute State-wise ” Hand-holding Teams ” of retired
    executives having ” Manufacturing ” experience , to guide the
    local GET applicants in obtaining all permissions from various
    State Authorities

    * Role of eBiz web site
    > To make available in public domain , all investment related
    applications , and progress status of each

    * Role of State Governments

    > To keep track of those eBiz investment applications where
    the State is the proposed manufacturing location
    > Pro-actively reach out to such applicants for expediting their
    proposals

    All of the above need not / must not take months to materialize !

    If it takes any longer , millions of India’s jobless will overthrow the governments in power !

    We don’t need an Oracle to tell us what future holds for us !

    ————————————————————————-
    hemen parekh
    16 Sept 2015
    B2BmessageBlaster

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