Press Release

Meru Cabs looks to add 10,000 EVs to fleet, sets course on B2B route

  • The company plans to invest $10 Mn in technology and electric vehicles by 2020-end
  • Meru’s revenue dropped by 5-7 percent during July and August but claims a surge in sales in September
  • Mahindra which holds 55% majority stake in Meru had said it will focus more to increase the cab provider’s fleet to EVs

Homegrown cab service provider Meru Cabs wants to keep its course in the B2B segment and doesn’t want to take the B2C route.  

Meru Mobility Tech Ltd founding and managing director Neeraj Gupta told Mint “indulging in a B2C war isn’t on its radar.”

“We are not really wanting to get into the B2C segment war. We want to focus on offering cab services wherever we are present and not beyond. We would be focusing on B2B through the mobility platform that we have created,” Gupta said.  

However, the company is eyeing for consolidation in the EV segment, with an investment of $10 Mn in the technology and electric mobility segment by 2020-end. It is also planning to create an infrastructure to operate a fleet of over 300 EVs across India. It plans to increase its fleet size and add 10,000 EVs “soon”.

This has been the central focus of Mahindra which acquired a 55% majority stake in Meru back in September 2019. The companies signed a subscription and shareholder agreement for subscribing up to 55% equity shares in tranches, Mahindra said in a BSE filing.

‘We have invested in technology and also in good leadership team members, which we were lacking, so that we can get out and get more contracts and good partnerships with the company,’ Gupta said.

In the electric vehicles segment, Meru competes with Ola and Uber who have also invested heavily to increase their fleet size. Uber currently runs 350 electric vehicles and plans to expand that to 1,500 by 2020-end. Meanwhile, Ola Electric runs pilot electric mobility projects in Gurugram, Bengaluru and Nagpur with the fleet size of 200 EVs.  

The government has been constantly focusing on the adoption of electric vehicles in India with FAME II.  The EV market size in India is expected to reach $707 Mn by 2025. The total funding raised by EV startups between 2014 to 2019 (H1) is more than $400 Mn.

Pandemic Speedbreaker For Meru

Gupta said due to pandemic, the company’s revenue dropped by 5-7 percent in July and August, but saw a surge in business in September.

“(In) August we were doing close to 50,000 bookings per month, now this time (September) we will be clocking 65,000-70,000 bookings per month, a growth of 15-20 per cent, with growth in intra-city rides,” he added.

He further said that during July and August, the ticket size has declined as the number of outstation bookings have gone down as people who were stranded have moved back to their places.

The company claimed that it had made over 2,00,000 deliveries through its cabs during the pandemic after it tied-up with ecommerce major Flipkart in April.

Mahindra group holds a majority stake in Meru Cabs. Meru has also integrated Meru EVGO and Mahindra’s electric vehicle GLYD for city and outstation travel. It will cater to users looking to travel in eco-friendly sedans in select cities across the country. Users can also book ride options like LITE, COMFORT, 6 PLUS, 6 PRO, and GLYD.

Meru considers Brand Capital, India Value Fund Advisors (IVFA), Bennett, Coleman and Co. Ltd (BCCL) as its investors.

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