With its fleet of electric vehicles, can BluSmart solve commuting problems?

There are several reasons why there is a need for a disruption in the ridesharing segment: lack of rides, long wait times, rides with high prices, drivers denying digital modes of payment… It is in response to these problems that the startup BluSmart was created, with its own fleet of electric vehicles (EVs).

“In recent years, the number of trips, the waiting time for trips, and the price of trips have been increasing. To top it off, most of these are ICE vehicles. It’s no secret that carbon emissions and pollution levels around the world have been on the rise. Vehicle emissions will continue to rise; the only way to reduce and stop that is to have a fleet of electric vehicles,” says Punit Goyal, co-founder and CEO of BluSmart. “So we decided to change the market and introduce a new mode of transportation,” he says.

Punit Goyal and Anmol Singh Jaggi, founders of BluSmart, had previously founded startups in the B2B segment.

After completing 2 million trips with more than 2,200 taxis in Delhi-NCR, BluSmart recently launched its operations in Bangalore. The company started with 70 EVs in Delhi-NCR in 2019. BluSmart now has more than 3,000 taxis in Bangalore and Delhi. In 2021, he raised $25 million from BP Ventures.

BluSmart

Anmol Singh Jaggi, Co-founder, BluSmart

I loved this story” contenteditable=”false” data-new-ui=”true” data-explore-now-btn-text=”undefined” data-group-icon=”https://images.yourstory.com/assets /images/alsoReadGroupIcon.png” data-headline=”1548 people loved this story”>

How the company operates

How is the BluSmart rideshare app different from the others? According to Punit, BluSmart does not function as a travel aggregator; He says it follows a full-stack approach: The startup leases EVs from leading manufacturers like Tata and Mahindra, owns the EVs, and operates them. The company has full ownership and operating rights to the vehicles and hires the drivers, he says.

Zero cancellations, no increase fee and on-time travel are the other features that the company promises to the subscribers. As for the carbon footprint, Punit says that BluSmart has saved more than 8,000 metric tons of CO2 with its fleet of electric vehicles.

In addition to addressing customer concerns, the startup also addresses the challenges drivers face. The company founder says the startup is creating an “inclusive and equitable economic opportunity: where drivers don’t have to worry about asset ownership.

“Drivers essentially make a lot more money on the BluSmart platform. In the case of Ola and Uber, when the drivers are micro-entrepreneurs and have an asset in the process of depreciation, they incur fuel costs, EMI, rent or commission payments. The driver ends up saving around 450 rupees on a bad day. And on a good day, 550 rupees,” explains Punit.

However, with BluSmart, drivers do not incur any costs; they get a guaranteed minimum payment from BluSmart and a variable payment based on their conduct with the BluSmart asset and the client, according to Punit. This results in a variable salary of 70% and a minimum guarantee of 30%.

“We generate trips in the BluSmart application; we assign rides to the driver, then match a particular job with a client and complete the ride. We take full responsibility for every trip we take here. Ola and Uber are a matching platform. They match a customer to a driver and the driver to the customer. If the match occurs, they charge a 25% commission on the completion of the trip, as a brokerage fee. A driver on the BluSmart platform can earn Rs 20,000 to Rs 24,000 a month,” says Punit.

BluSmart drivers must pick up vehicles at designated BluSmart parking/charging stations.

“When you remove the burden from the driver, their behavior and model automatically change to help both the customer and the driver,” Punit says.

BluSmart

Super BluSmart charging center

I loved this story” contenteditable=”false” data-new-ui=”true” data-explore-now-btn-text=”undefined” data-group-icon=”https://images.yourstory.com/assets /images/alsoReadGroupIcon.png” data-headline=”1242 people loved this story”>

Market conditions

According to the Blume Primer Report 2022, the company has dedicated charging centers, rental vehicles, and an easy-to-use app. However, the small size of the fleet is a concern as the availability and frequency of BluSmart trips are not high at the moment. Punit explains that as its fleet size increases, these challenges will be overcome.

Currently, the startup has rolled out a few taxis in Bangalore. It is looking to have 25,000 to 30,000 taxis in the city by the end of next year. It has signed an agreement with Tata Motors to deliver more than 10,000 XPRES T EVs.

Vinod Murali, Managing Partner of Alteria Capital, a venture debt fund that has invested in BluSmart, says: “While still growing, many of the new-age passenger transport platforms are finding niche audiences and have growing popularity among users. People want convenience and these apps give them that where the biggest headlines are failing.”

Experts say that given the combination of increased market share and a significantly lower cost structure, EV mobility providers will be able to compete with established aggregators like Ola and Uber. In India, mYn and dife are BluSmart’s competitors.

Vidhya Shankar, CEO of Grant Thornton, says: “(For) the large number of people today who need a good public transport system, we need all kinds of transport services, whether it is cars, bicycles, cars, electric vehicles etc. This is especially true for a city like Bangalore where travel time seems to be increasing. From a mobility perspective alone, there is a need for cleaner, more affordable, and more punctual public transportation. The market is clearly there.”

According to Vidhya Shankar, the second wave of disruption is happening in the global taxi aggregator market. He is referring to the DIEY app in New York, which is focused on Manhattan and is 30% cheaper than UBer. “The algorithm has discovered the most used times and locations. They bring newer vehicles to the market. In India, the capacity and volume of vehicles is significantly high, leading to more players entering the market.”

To meet this market demand, BluSmart has the ambitious goal of having more than 1,00,000 vehicles in the country by 2025.