Chasing Ola and Uber: Tata Motors bites the bullet with Bolt


Bolt. Photo:

Bolt. Photo:


  After taking a hard stand over disallowing its new crop of passenger cars being bought by  taxi fleets, Tata Motors has abruptly changed its strategy and is now chasing the same set of customers. 


In mid-2014, the company had declared that all new models beginning with the Zest (a compact sedan), followed by Bolt will not be sold to buyers who put the cars for commercial use. The company had then turned down several requests from buyers who operate their vehicles under the Ola or Uber banner. 

Launched nearly two years ago, the Tata Bolt, however, has been a huge disappointment for the company. The cumulative volumes of the Bolt since its launch in January 2015 has been under 20,000 units, which is less than what Maruti Suzuki Swift sells in two months. 

Priced at Rs 4.79 lakh (ex-showroom, Mumbai), the Bolt competes with Maruti Suzuki Celerio, Hyundai i10, Toyota Etios Liva to name a few. The hatchback is built on the same platform as the Zest, but runs on a new generation of petrol and diesel engines.

With growing demand for intra-city cabs and mouth watering discounts offered by rivals like Hyundai, Toyota and Maruti Suzuki to the tune of 15-20 per cent, Tata Motors too has decided to not just allow, but promote the sale of the Bolt to such aggregators. 

“We are repositioning the Bolt for aggregators and we are finding good traction there. Aggregators are a big and important business and it is an idea whose time has come. We cannot ignore aggregators”, said Mayank Pareek, president (passenger vehicle business unit), Tata Motors. 

Pareek, however, denied that the company ever spoke about declining to sell to aggregators. “We did not say that we will not sell our cars to aggregators,” Pareek had said in an interview to Business Standard.

Tata Motors’ old warhorses the Indica hatchback and Indigo sedan had built their reputation as  favourites amongst taxi operators. This later became one of the main reasons why private buyers stayed clear of Tata-branded cars and instead preferred other labels of Japanese or Korean origin. 

“The Zest and Tiago will continue to be aimed at the individual buyer, whereas the Bolt, Indica and Indigo will be targeting the aggregators,” Pareek said. 

After being labelled as a threat to car making companies, cab aggregators are today hailed as saviours. Web-based cab aggregators like Ola and Uber, for instance, have signed deals with most of the mass market car makers worth more than Rs 15,000 crore for car purchases. 

This has forced companies to create a separate sales and marketing wings to cater to such buyers. In September, Ola had announced a tie-up with sports utility vehicle major Mahindra & Mahindra for 40,000 vehicles spread over two years. 

Uber too joined hands with Tata Motors to source the Indica and Indigo on flexible and customised financing solutions from Tata Capital Financial Services and Tata Motors Finance, besides affordable insurance from Tata AIG.

Media reports had stated earlier that Uber plans to lease as many as 200,000 passenger vehicles until 2018 to individuals who wish to join the company. This translates to a minimum investment of Rs 9,000 crore by the cab hailing company.