Is an Uber Acquisition on the Horizon?
India’s First EV Ride-Hailing Startup at a Crossroads
BluSmart, one of India’s pioneering electric vehicle (EV) ride-hailing startups, is actively looking for a buyer as it struggles with financial challenges stemming from its asset-heavy business model. Reports indicate that Uber is in the early stages of evaluating a potential acquisition, possibly through its fleet vendor Everest Fleet, though no formal deal has been confirmed.
This development comes despite BluSmart’s denial of any acquisition talks. The company issued a media statement on March 16 dismissing reports of negotiations with Uber as “speculative and unfounded.”
Uber’s Strategic Interest in BluSmart
According to industry sources, Uber’s interest in acquiring BluSmart aligns with its broader green mobility strategy in India. The global ride-hailing giant has been expanding its EV partnerships, aiming to introduce 25,000 electric cars on its platform in the next two years.
Uber has already collaborated with EV fleet operators such as:
- Lithium Urban Technologies
- Everest Fleet Pvt Ltd
- Moove
In addition, Uber has partnered with Zypp Electric to deploy 10,000 EV two-wheelers in Delhi by 2024. Acquiring BluSmart could further strengthen Uber’s electric vehicle fleet in India, giving it direct access to BluSmart’s charging infrastructure and fleet management expertise.
However, the high cost of BluSmart’s assets remains a concern for any potential buyer, as noted by a senior industry executive:
“Uber could be evaluating whether this would be a good synergy. However, BluSmart’s assets are expensive for anyone to acquire as of now. It will take much longer for this deal to proceed.”
The BluSmart-Gensol Connection: A Financial Challenge
BluSmart’s financial struggles are deeply linked to Gensol Engineering, a renewable energy company that has played a crucial role in BluSmart’s operations.
- Gensol, led by BluSmart co-founder Anmol Singh Jaggi, has been a key supplier of EVs and charging infrastructure.
- Approximately two-thirds of BluSmart’s 7,000 electric vehicles are leased from Gensol.
- This financial dependency has become problematic as Gensol itself faces liquidity issues.
Gensol Engineering’s stock price plummeted by 68% in early 2025, largely due to:
- Delays in debt servicing to BluSmart bondholders
- Increased share pledges, now at 85.5%
This liquidity crisis raises concerns about Gensol’s ability to support BluSmart’s operations, potentially jeopardizing BluSmart’s long-term sustainability.
BluSmart’s Journey: From Bold Vision to Financial Struggles
BluSmart was launched in 2019 with a vision to create a sustainable, all-electric ride-hailing platform in India. Unlike Ola and Uber, which operate on an asset-light model relying on driver-owned vehicles, BluSmart owns and operates its fleet and charging stations.
Milestones and Challenges:
✔ Customer Trust: BluSmart gained traction among environmentally conscious commuters seeking reliable, well-maintained EV rides with fixed fares.
✔ Early Growth: Expanded rapidly in Delhi-NCR and Bengaluru, becoming India’s largest all-electric ride-hailing service.
✔ Funding: Raised over $200 million from investors including BP Ventures, Mayfield Fund, and Green Frontier Capital.
However, the high cost of owning vehicles and charging infrastructure has posed significant challenges:
✖ High Capital Expenditure: Unlike Uber and Ola, BluSmart burns cash at a faster rate due to its fleet ownership model.
✖ Slow Expansion: While its Delhi-NCR operations have been successful, the company has struggled to scale beyond key metro cities.
✖ EV Delivery Delays: Expansion has been affected by supply chain challenges slowing EV deliveries.
Financial Snapshot:
- FY23 Operating Revenue: ₹170 crore (up from ₹29 crore in FY22)
- Net Loss FY22: ₹65.5 crore (compared to ₹39.4 crore in FY21)
- Annual Revenue Run Rate in FY24: ₹400 crore
While revenues have increased, the company remains unprofitable, making it less attractive to new investors.
Investor Sentiment and BluSmart’s Search for a Buyer
BluSmart’s recent $24 million funding round in 2024 was largely backed by existing investors, including BP Ventures. However, the appetite for fresh investment in BluSmart’s capital-intensive model is waning, leading the company to explore a sale or strategic partnership.
An industry expert highlighted:
“Unlike asset-light ride-hailing firms, BluSmart’s requirement for infrastructure investment means it burns cash at a much faster rate. With profitability still out of reach, investor appetite has waned, pushing the company to explore a potential sale.”
Competitive Landscape: BluSmart vs. Industry Giants
BluSmart competes against Ola, Uber, and emerging players like Rapido and Namma Yatri. While BluSmart has a first-mover advantage in EV ride-hailing, its business model differs significantly from competitors:
| Company | Business Model | Key Focus | Challenges |
|---|---|---|---|
| Uber | Asset-light, driver-owned vehicles | Expanding EV fleet through vendors | Driver dissatisfaction, fare volatility |
| Ola | Asset-light, driver-owned vehicles | Large nationwide presence | Regulatory hurdles, declining service quality |
| Rapido | Bike and auto ride-hailing | Expanding EV auto fleet | Scaling challenges in car ride-hailing |
| Namma Yatri | Open network, driver-led model | Zero commission rides, driver empowerment | Limited reach outside Bengaluru |
| BluSmart | Asset-heavy, company-owned EVs | Sustainability, charging infra | High capital investment, slow expansion |
Emerging Threats in the EV Ride-Hailing Space
- Rapido is expanding its EV auto-rickshaw fleet, signaling potential entry into EV car ride-hailing.
- Namma Yatri, with its zero-commission model, is gaining traction, presenting a decentralized alternative.
- New startups like Evera and Moove are entering the B2B electric ride-hailing market, increasing competition.
- Traditional automakers and fleet operators are also investing in EV ride-sharing, intensifying market pressure.
The Road Ahead?
BluSmart’s hunt for a buyer or strategic partner is a defining moment for the company and India’s broader EV mobility sector.
An industry source noted:
“If BluSmart secures a strategic partner with deep pockets, it could strengthen its market position and accelerate growth. However, if a deal doesn’t materialize, sustaining operations will be difficult.”
The bigger question remains: Can an asset-heavy EV ride-hailing model thrive in India’s price-sensitive market?
With BluSmart’s future hanging in the balance, the fate of sustainable urban mobility in India could also be at stake.
