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What Ola needs to consider when getting into the electric car segment

Cab-hailing company Ola has set up a subsidiary for its electric car segment, reports Hindu Business Line. In March, CEO Bhavish Aggarwal said that the company will debut these cars in several Indian cities and start scaling up its operations. SoftBank Group chairman Masayoshi Son said that Ola may add up to 1 million electric cars on the road. Note that Ola also has a strategic tie-up with Mahindra & Mahindra, which manufactures electric cars in India.

So far Ola has been making the right noises for the electric car segment. But here are a few things that the company has to consider for electric cars.

1. Range and charging stations 

Electric cars have limited range and right now there isn’t a proper ecosystem for charging stations in the country. The Tesla Model S has a range of around 335 km with a 60 kWh battery meanwhile the Nissan Leaf electric car has a range of 172 km with a 30 kWh battery. In India, Mahindra’s e2o car has a range of 120 km and the car takes about five hours for a charge on normal mode.

Charging times for these cars will be crucial operations and right now India simply does not have enough charging stations. Mahindra right now only has around 250 charging points. There’s also PlugInIndia, a which runs a number community charging stations, but it has around 218 stations.

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Ola will have to invest in a number of charging stations and in the right locations to handle more than a million electric cars. Perhaps it can look at a tie-up with the NTPC which is looking at charging stations to help create the demand for electricity generated by its plants.

2. It will have to look at ride sharing and fixed routes 

With limited range and charging points, electric cars will not have the same freedom of mobility as petrol and diesel cars. In such a scenario Ola will have to look at the electric cars only along certain routes and ridesharing. As such, Ola will not be able to provide regular point-to-point cab services as cars may run out of electricity in the middle of a ride. They will have to make sure that there is a spare battery to complete the trip. Remember charging times may take up to five hours.

What Ola can do is look at the operations of Lithium, a Bangalore-based electric cab service. Lithium has a fleet of 200 cars and has charging points in prominent tech parks in Bangalore. Ashwin Mahesh, CEO of Lithium, said that the company has invested tamper-proof GPS technology to monitor their cars and make sure that the drivers don’t moonlight for other services.

3. Ola needs to get the right permits for fixed routes

Note that the Ola Shuttle service is in trouble with Bangalore’s transport authorities for not having the correct permits to run fixed route services. In 2015, Ola Shuttle ran into trouble with Delhi’s transport authority and had to suspend its operations. At the time, Ola Shuttle had not obtained permits for shuttle services as well.

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In Bangalore, Ola is again at a handicap as the Bangalore Metropolitan Transport Corporation (BMTC) is the only company which a stage carriage permit in the city which allows them to fixed route services. The BMTC is also protected under the Road Transport Corporation Act, 1950 does not allow private operators to set up competing services.

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