Ratan Tata's Tata Motors announced a new partnership with Uber in India. The deal will give drivers special pricing and financing on Tata cars.
India’s influential and multi-faceted Tata Group it’s partnering with Uber Technologies, the growing ride-sharing giant, to provide Uber drivers with special pricing and financing benefits from the giant conglomerate.
Under the partnership, drivers looking to operate Uber cars can buy Tata vehicles such as the Indica and Indigo models from Tata Motors and also gain access to flexible and customized financing solutions from Tata Capital and Tata Motors Finance.
The drivers will also be able to buy insurance from Tata AIG, said Madhu Kannan, member-Group Executive Council and group head for business development and public affairs for Tata Sons.
Tata Business Support Services will provide additional operational support to drivers who want to use this new vehicle solutions program, according to Tata, which also emphasized the initiative will span the Indian subcontinent.
During the next year, the initiative is expected to pave the way for more than 20,000 drivers to start their own business on the Uber platform, Kannan said.
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Last year, Tata Opportunity Fund invested $100 million in Uber.
Eric Alexander, head of Business, Uber Asia, said Uber is making it possible for millions of people in India to get a ride to work at the push of a button.
“It’s clear from talking to drivers how much they value their flexibility and independence. It’s why we are excited to work with the Tatas to help make it easier and more affordable for drivers to get on the road, thereby promoting micro entrepreneurship in India,” Alexander said in a statement.
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The potential for car sharing in markets such as India, where the density of vehicle ownership is still relatively low, is thought to be substantial, according to analysts.
The Tata and Uber tie-up highlights the growing global trend of automakers forming relationships with the sharing service industry, as car makers continue to look to tap into alternative mobility markets in order to expand vehicle sales, noted BMI Research.
“By providing comprehensive financing and support solutions, we believe this agreement between Tata Motors and Uber will help bolster ailing passenger vehicle sales for the Indian car maker,” BMI noted.
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Tata’s sales have fallen year-over-year and the tie-in with Uber also promises to make the purchase process less difficult, BMI analysts said.