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BluSmart: It is Taking on Ola and Uber

Zabir Rahman | December 12, 2021

BluSmart is the newest entrant in the ride hailing segment, and it seems to be checking off all the right boxes.

BluSmart: It is Taking on Ola and Uber

If you’ve visited Kolkata or Calcutta for over two decades, you will have seen that yellow Ambassador taxis are a ubiquitous feature. They are as much a city highlight as other age-old landmarks.

The yellow cabs have had their fair share of quirks. For example, their fare metres, for unknown reasons, could not be upgraded. So, starting in the mid-2000s, the fare metre would display a certain amount, but at the end of a trip, the driver would pull out a little card, usually from the sunshade over his seat.

On this card would be written the corresponding fare that was significantly higher. In simple terms, if the fare metre read INR150, the actual payable was closer to INR300. Also, it was not uncommon to flag one down, be asked where the destination was, and then be promptly refused. “Nahi jayega” or “jaabo na” was a common response.

An outrageous proposal amid stiff competition

In 2015 or so, I came across a hilarious piece in the newspapers. The columnist shared how certain yellow cab driver unions had proposed a ‘surge pricing’ of sorts. Since Kolkata experienced hot and humid weather for the better part of nine months annually, the union suggested that customers pay higher during morning and evening trips.

This strategy, in their warped business sense, would help offset lost business during the afternoons when the sunshine was at its scorching best. It was inconvenient for the drivers to work during this time of day, or so they felt.

But the rider, who needed to get from one place to another, would have to wait until the opportune moment arrived, when the sun had gone down and the drivers were ready to resume work. That this proposal came forward after the likes of Ola and Uber had already dented their business, was the icing on the cake.

Higher service levels

Ola and Uber ushered in previously unexperienced conveniences when they first launched their services. Using a smartphone app, an individual could book a taxi at a time and place of their choosing. Even more, there was no possibility of a cancellation.

A further bonus was the fact that their fares were substantially lower and the cabs were all air conditioned. For drivers, it meant a huge increase in incomes. There were incentives aplenty and it was not uncommon for an Ola or Uber driver to net over INR50,000 per month. Many in white collar jobs were not bringing in such incomes.

However, as the years went by, the fares began to climb quickly, driver incentives were discontinued, and the previous no cancellation policy was now a major bane. Just like the yellow cabs, the driver would cancel and even have the pluck to ask the user to hit cancel on their side of the app. As a rider, one would think that the cab aggregator platform would use cancellation data to take their drivers to task. But this bane has continued like it is nobody’s business.

Also, one major irritant for riders was the question that drivers would ask — of whether one was paying by cash or an e-wallet. I did ask a few drivers of why they were reluctant to accept digital payments. Their reply was that Ola or Uber would only pay them two weeks hence.

Disrupting the disruptors

These shortcomings are exactly what New Delhi based BluSmart is attempting to address. For instance, the driver’s side of the app does not have a ‘cancel’ feature. And while the company helps with personal mobility, it is also addressing environmental concerns. BluSmart’s entire fleet is electric, comprising electric Tata Tigors.

The company signed a Memorandum of Understanding, in October 2021, with Tata Motors to add a further 3000 electric vehicles to its fleet. Unlike Ola or Uber, where the vehicles are driver owned, BluSmart will have ownership of all its vehicles. And this also implies that these vehicles need a place to charge their batteries. The newest entrant in the ride-hailing segment has, therefore, tied up with Jio-BP — a joint venture between Reliance and British Petroleum.

BluSmart has also onboarded women drivers. In that sense, it seems to be checking off all the right boxes — spanning higher service levels, environmental concern and women empowerment.

A key facet that BluSmart also addresses is etiquette. This is hugely lacking across most businesses in India. In fact, it was surprising when I first learnt of it but BluSmart drivers hold the door open for the rider.

Finding workarounds

There is but one area where BluSmart may face the heat. Its vehicles need to be booked at least 30 minutes in advance. Where the rider already has a set itinerary, this will not pose a problem. However, it may lose out on rides where spontaneous travel decisions are made. On the same right, BluSmart users have reported that their vehicle usually reaches the pick-up point well in advance of the 30 minutes.

On the charging front, although BluSmart has entered into an agreement for charging stations or “Superhubs”, these will not necessarily become a common feature countrywide. It will be a while before their footprint extends to tier-II and III cities.

However, innovative as it is, BluSmart will certainly find workarounds. In fact, if the Indian government soon introduces a formal crypto asset framework, it will not come as a surprise if BluSmart uses its vehicle processors’ downtime for crypto mining. This is certainly one company to watch out for. It holds potential to disrupt the disruptors.

Zabir Rahman

Zabir drives research writing at Stonebench, Singapore. His core interest was automobiles, although with time, he thinks he is growing more fond of writing and teaching. Zabir is now keenly interested in the technology space and is part of the Elbyte editorial team.

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