Ola acquired TaxiForSure 18 months back to dominate the Indian ride hailing market
Taxi aggregator Ola has shut down TaxiForSure as a move to reduce costs. Ola is now saving Rs 30 Crores per month in human resource expenses after this move.
18 months ago Ola acquires its rival TaxiForSure for a striking deal of $200 M. This was a move to dominate the Indian taxi market and put down Uber. Since then Ola is silently integrating TaxiForSure(TFS) services into their platform and stopped all developments of later. Now 700 employees are out of jobs. But in a statement Ola said that they are filling existing vacant positions in Ola with TFS employees. Also TFS employees are given satisfying severance.
Ola due to its new initiatives like grocery and food delivery lost its market share to the American rival Uber. With their new Ola micro they are conquering the market again. The only problem Ola was seeing was the expenses it was acquiring every month. They reported losses of Rs. 796 crores. Now when it has cabs that are as cheap TFS they decided to close this unit and reduce costs.
Although this move will reduce expenses there is one more bad news for Ola. Its competition Uber has onboarded China’s Didi Chuxing on their team.
We have to wait to see which cab aggregator wins Indian market.
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