About Taxi For sure:
Taxi For Sure is a Bengaluru based taxi service founded by Indian Institute of Management-Ahmedabad alumni Raghunandan G and Aprameya Radhakrishna. The company was backed by Accel Partners, Bessemer Venture Partners, and Helion Venture Partners. It focused strongly on providing cabs at cheap rates to different segments.
About 18 months ago, Taxi For Sure was acquired by the main player of cab services in India, Ola for a whopping $200 million.
What and why did Ola exactly do?
On 17th August, Ola shut down the TFS taxi services which could be availed through the Ola app, permanently. TFS was working as an independent player in major markets despite being under Ola due to which Ola was incurring losses and it’s position wasn’t going higher either. To compete with the other giant, Uber and conquer the number one position, Ola decided to lay off TFS services forever.
Also, Ola wasn’t clear about Taxi For Sure’s branding which is why they were allowed to operate independently in the market. Ola had incurred losses of Rs 796 crore on revenues of Rs 421 Crore in 2015 and shutting down TFS would help them save about 30 crores each month.
The outcome of this decision:
This decision might be beneficial for Ola in the future but has caused a huge lay-off in the employement sector as over 700 employees have lost their jobs.
However, Ola has tried to minimise employee losses by integrating the tech and HR teams for the two companies into one. Also, some TFS drivers were offered alternative job options of driving the low-rate Ola Micro cabs.
“With all TFS driver-partners and customers coming on board the Ola app, the integration is now complete,” Ola Spokesperson said in a statement. “We have absorbed as many TFS employees for open roles in Ola to support our growth. For positions that cease to exist as a result of this transition, we are offering enhanced severance benefits and outplacement services to help affected employees pursue new career opportunities.”
He also added that the employees who were being laid off would get three months’ worth salary as part of their severance package.
How this decisions turns out to be in favour or against Ola would be interesting to see in the future!
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