Ola Chairman and Group CEO Bhavish Aggarwal on the Ola Scooter in Bengaluru
Ola Electric said on July 12 that it has raised $100 million in long term debt from Bank of Baroda to close the first phase of development of its factory, where it plans to make electric two-wheelers.
The Bhavish Aggarwal-led firm, spun off from ride-hailing firm Ola, is setting up a 500-acre factory in Tamil Nadu's Krishnagiri, aiming to make 10 million vehicles a year at full capacity -- making it the world’s largest two-wheeler factory, the company claimed.
“Today’s agreement for long term debt financing between Ola and Bank of Baroda signals the confidence of the institutional lenders in our plans to build the world’s largest two-wheeler factory in record time. We are committed to accelerating the transition to sustainable mobility and manufacture made in India EVs for the world and we are happy that Bank of Baroda has joined us in our journey,” said Aggarwal, Chairman and Group CEO, Ola.
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Moneycontrol had reported in April that Ola Electric plans to invest $2 billion over the next five years along with its partners to set up more than 1 lakh charging stations across 400 cities. Lack of charging stations is currently one of the biggest hindrances to mainstream EV usage in India.
“The government has brought in several policies to incentivise make-in-India and to enable India to become a global EV leader. Ola is leading from the front and we are delighted to partner with them for their EV business. The Ola Future Factory will put India on the global EV map and we are proud to be associated with them”, said Sanjiv Chadha, Managing Director & CEO, Bank of Baroda.
Ola Electric is valued at over a billion dollars, with the backing of investors such as Matrix Partners, Tiger Global Management and SoftBank, among others.
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"The biggest barrier to consumer adoption and the biggest question that people have is: if we buy an EV, where will I charge it? Some call this range anxiety. We will be setting up a hyper charging network that will allow people to charge their Ola scooters across any location which is five-10 minutes away. These hyper charging towers in high streets, high-density areas, and stations in partnership with fuel companies. We will also put up destination chargers in places like office complexes, malls, and hospitals," Ola had said earlier.
Ola’s core ride-hailing unit is also planning to list on stock exchanges soon, for which it raised $500 million from Warburg Pincus and Temasek, giving early backers Tiger and Matrix a part exit from their stake in the company too.Read: Ola Group CEO shares pictures of factory progress, teases new e-scooter