Say Ola To Ola’s New Shuttle Service; To Be Launched In Bangalore & Gurgaon

Post raising $400 Mn and being valued at around $2.5 Bn, in April this year, Ola has unleashed yet another weapon against its rival, Uber. Today the company is announcing the launch of Ola Shuttle – a service to offer shuttle bus service to urban commuters.

The service will be launched on 21 September, and will initially cover Bangalore and Gurgaon. The service radius will include new cities next quarter. The maiden fleet will include 500 shuttles spanning 100 routes.

The shuttles will come equipped with features such as WiFi access, air conditioning and in-vehicle entertainment. Ola will source the shuttles from sole traders with their vehicles or from tourist companies with their fleet of vehicles. These companies can integrate themselves into Ola app and source passengers.

Passengers can use the app to scan and track shuttles on the map, book their seats and make payment. The rides will cost under $1 (INR 66).

“Millions of Indians undertake their daily commute in our cities using their own vehicles, cabs or other modes of personal transportation. With Shuttle, we intend to create a comfortable and reliable commute experience for them at the tap of a button on their smartphones. This will bring in efficiencies at scale, for suppliers who will work with us and will help enable mobility for a billion people,” Bhavish Aggarwal, co-founder and CEO at Ola, said in a statement to Inc42.

Sensing immense potential in this domain, various emerging bus and shuttle aggregators have sprouted-up in India such as rBus, Shuttl, ZipGo and Cityflo. They allow commuters to book seats in AC buses plying in various cities using web and mobile app.

rBus operates in Mumbai and charges INR 500 for 10 rides a week. It has partnered with various chartered bus operators to source the vehicles. Delhi-based Shuttl offers mobile based minibus service for economical urban commute. It even offers cashless payment options. The company raised $3 Mn from Sequoia Capital and other angel investors.

The shuttle aggregation model is picking up pace globally as well. On-demand transit system called Via offers urban shuttle service in Manhattan, USA. It takes multiple passengers heading in the same direction and books them into a shared vehicle. The cab aggregator titan of China, Didi Kuaidi launched its shuttle service in July. After raising $2 Bn in July, the company today announced that it has completed a $3 Bn fundraising round. Even Uber is experimenting with its ride-sharing service called UberPOOL in the US.

Ola’s total funding till date amounts to around $680 Mn, including the $400 Mn raised in a Series E fundraising round. Sundeep Sahni, VP of New Initiatives at Ola told Techcrunch that nearly $50 Mn will be invested to fuel the new shuttle service. The company is backed by investors such as Japan’s SoftBank and Russian billionaire Yuri Milner’s DST Global, Accel Partners and Tiger Global Management.

Ola is no longer just a cab and auto-rickshaw hailing app, as the company is steadily diversifying into other domains as well. Earlier this year, it incorporated the food delivery feature called Ola Café in its app. It has even started delivering groceries in Bangalore, Hyderabad and Gurgaon with the launch of its on demand grocery delivery mobile-only app called Ola Store.