BluSmart Mobility, India’s pioneering all-electric ride-hailing service, is undergoing a significant transformation marked by a series of top-level departures, according to media reports. CEO Anirudh Arun, Chief Business Officer Tushar Garg, Chief Technology Officer Rishabh Sood, and Vice-President of Experience Priya Chakravarthy have all stepped down as the company embarks on a restructuring journey aimed at fortifying its financials and accelerating its path to profitability.
Nandan Sharma, previously Vice-President of Business and Operations, is stepping into the CEO role to steer the company through this pivotal phase. Sources indicate that further leadership changes could follow. This leadership transition underscores the company’s need for fresh strategic thinking to navigate the complexities of scaling an electric vehicle (EV) fleet while optimizing financial performance.
Fleet Overhaul and Leasing Deal
A cornerstone of BluSmart’s restructuring plan is a fleet optimization strategy involving its parent company, Gensol Engineering. Gensol is divesting 2,997 electric vehicles to Chennai-based Refex Green Mobility in a sale-and-leaseback arrangement. This deal, encompassing 34% of BluSmart’s 8,700-strong fleet, sees Refex assuming Gensol’s existing loan of ₹315 crore. The transaction is pending regulatory approval but is central to BluSmart’s efforts to streamline operations while maintaining service continuity while expanding operations.
The decision to restructure its fleet aligns with BluSmart’s long-term ambition to create a more agile operational model. By shifting the ownership of a significant portion of its vehicles to a third-party leasing partner, the company aims to reduce its capital burden while ensuring the fleet remains operational and continues to meet growing customer demand.
Financial Pressures and Operational Challenges
The restructuring coincides with mounting financial pressure on Gensol Engineering, which has recently had its borrowing status downgraded to default by two rating agencies. Despite these headwinds, BluSmart insists that its ride-hailing services across Delhi-NCR, Bengaluru, and Mumbai remain unaffected. The company continues to operate at scale, with its fleet averaging seven trips daily and supported by a robust infrastructure of 50 charging hubs and over 6,300 charging points.
As BluSmart navigates these operational challenges, the company remains focused on strengthening its service delivery model. Leveraging its charging infrastructure and technology-driven operations, BluSmart is positioning itself as a resilient player in India’s evolving electric mobility landscape.
Diversifying Acquisition Models
To bolster its fleet expansion, BluSmart introduced the ‘BluSmart Assured’ leasing programme last year, inviting high-net-worth individuals and investors to lease EVs directly to the company. This innovative model has already added nearly 1,000 cars worth approximately ₹150 crore to its operational fleet, providing a crucial capital infusion during its transition.
The introduction of the BluSmart Assured programme reflects the company’s broader vision of democratizing access to EV investments while ensuring a steady inflow of vehicles into its fleet. This model not only reduces reliance on traditional financing but also deepens stakeholder engagement with the company’s growth journey.
Revenue Growth Amidst Losses
BluSmart’s revenue trajectory shows notable growth despite widening losses. The company currently generates monthly revenues of ₹70 crore, translating to an annual run rate of ₹840 crore. However, according to Tracxn, BluSmart’s net losses grew from ₹100.4 crore in FY22 to ₹215.9 crore in FY23. Co-founder Puneet Singh Jaggi remains confident in the company’s long-term prospects, reaffirming BluSmart’s commitment to achieving profitability within the next 6-8 quarters.
This upward revenue trend is a promising sign amid the restructuring efforts. While profitability remains a challenge, the company’s ability to grow its top-line performance highlights the increasing consumer adoption of electric ride-hailing services and BluSmart’s capacity to capture market share.
Looking Ahead
BluSmart’s restructuring and leadership changes signify a company at a crossroads, balancing rapid growth with financial discipline. As the company refines its operating model and explores new avenues for vehicle acquisition, the road to profitability remains challenging but not insurmountable. All eyes are now on the newly appointed leadership and the execution of these strategic shifts to determine BluSmart’s trajectory in India’s evolving EV landscape.
The coming quarters will be crucial as BluSmart’s new leadership navigates the complexities of scaling operations, managing financial pressures, and sustaining service excellence. The success of these strategic shifts will not only shape BluSmart’s future but also influence the broader narrative of electric mobility adoption in India.
