Priyanka Tiwari
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Uber is reportedly in the initial stages of discussions to acquire BluSmart, an electric vehicle-based ride-hailing company. The news comes as Gensol Engineering, BluSmart’s parent company, considers an exit from the capital-intensive business due to liquidity concerns, sources informed.
Despite these claims, BluSmart has denied any such negotiations.
BluSmart Denies Acquisition Talks with Uber
A spokesperson for BluSmart refuted the speculation, stating:
“BluSmart categorically denies any discussions or negotiations regarding an acquisition by Uber. The report suggesting such a development is entirely speculative and unfounded. As India’s leading EV ride-hailing and charging infrastructure platform, BluSmart remains focused on scaling its operations, expanding its footprint, and driving sustainable mobility forward.”
Gensol Engineering, primarily known for its solar engineering, procurement, and construction (EPC) business, ventured into the electric vehicle sector with BluSmart in 2019. The company positioned itself as a sustainable alternative to Uber and Ola, offering fully electric cabs for urban transport.
Challenges in BluSmart’s Business Model
Despite its promising start, BluSmart has encountered several financial and operational hurdles:
- High fleet acquisition costs
- Infrastructure expenses for EV charging networks
- Incentives for drivers impacting profitability
- Reliance on government subsidies, which have been delayed
While BluSmart successfully raised funding from bp Ventures and other institutional investors, the company has yet to achieve profitability.
Uber Declines to Comment on the Potential Acquisition
While BluSmart has dismissed the acquisition reports, Uber has declined to comment on the matter. The Economic Times first reported on this potential development.
BluSmart’s Business Strategy and Growing Competition
BluSmart initially differentiated itself as a premium, no-surge pricing EV ride-hailing service focused on sustainability. The company strategically expanded in Delhi-NCR and Bengaluru, targeting corporate clients and airport transfers.
However, competition from Uber and Ola, which have also invested in EV fleets, has intensified. Unlike its rivals, BluSmart owns and operates its vehicles, leading to significantly higher capital expenditure.
Financial Struggles and Funding Challenges
The company’s dependence on government incentives has been both beneficial and challenging. Delays in subsidies and rising EV financing costs have placed further strain on BluSmart’s finances. Reports indicate that the company has struggled to secure new funding, which may have influenced Gensol Engineering’s decision to reconsider its involvement in the business.
In 2024, BluSmart raised approximately $24 million from existing investors, including bp Ventures, alongside contributions from its founders and leadership team.
BluSmart’s Growth and Future Prospects
Founded in December 2019 by Anmol Jaggi, Punit K Goyal, and Puneet Singh Jaggi, BluSmart set out to revolutionize the Indian ride-hailing market with a sustainable EV-first approach. Since its inception, the company has raised $109 million across its seed and Series A rounds.
BluSmart reports an annual revenue run rate exceeding $50 million, with 100% year-on-year growth. The company currently operates:
- 6,000+ EVs as part of its ride-hailing fleet
- 4,000+ EV chargers across 35 charging hubs in Delhi-NCR and Bengaluru
Despite its impressive expansion, uncertainty looms over BluSmart’s future amid ongoing financial constraints and the growing presence of Uber and Ola in the EV space.
Read More: Uber in Early Talks to Acquire BluSmart Amid Parent Company Gensol Engineering's Financial Struggles
