Ola to sell 5,000 used cars to Dbest cars for Rs 125 crore

Ola Fleet Technologies leased cars to cab drivers who operated exclusively on the Ola app before the pandemic, when demand for the service far exceeded the number of cabs on the app, leading to longer wait times.

As soon as the pandemic hit, more than 33,000 cabs were returned to Ola as the ride-hailing business crashed amid lockdowns, sources said. Multiple sources told ET that the company has since struggled to sell these vehicles, which have been parked in garages across big cities in India.

The source cited above said around 8,000 cars have been sold to various driver partners and other entities since the pandemic began. Dbest Cars is the biggest buyer of used cars from Ola to date. After the sale, Ola Fleet Technology will still have thousands of cars, four to five years old, that it has been unable to sell.

The development comes as Ola is set to enter the EV cabs space to take on BP Ventures-backed BluSmart and Uber, which ET was the first to report on January 4. Sources told ET at the time that the company was likely to lease EV cabs to drivers, though the exact business model was yet to be decided. The company is set to start the pilot in Bengaluru with about 1,000 electric cars before scaling it up to 10,000.

“Sale of used commercial cars is totally different from the sale of normal used cars (with white licence plates),” said Gulshan Rao, director of risks and brand protection at Ola. “For the sale and purchase of used commercial cars, there are a lot of obligations which need to be carefully fulfilled and as a responsible company, we need to choose the right partner for this to avoid any future disputes.”

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“We are fortunate to be able to get the opportunity to work with India’s largest radio taxi company and feel proud to have been chosen by Ola to help them dispose of thousands of used commercial vehicles,” said Dinesh Singh, MD and CEO at Dbest Cars India. “This association will provide an accelerator for the growth of our startup.”Ola Fleet Technologies has been dragged to court by some drivers as it started selling vehicles for which the drivers have been paying a lease amount, with the alleged promise of owning these vehicles in the future.

Despite numerous consumer complaints about declining service quality, Ola founder Bhavish Aggarwal has said on multiple occasions that the ride-hailing business is “highly profitable” and “a mature business”.

Governments across the country are also encouraging the electrification of fleets with new regulations that favour EVs.