BluSmart, which was started as Gensol Mobility at the close of 2018, is going through a pretty difficult period right now. This chaos follows a probe into Gensol Engineering, accusing the company of misusing electric vehicle (EV) loans. Originally conceived as an Uber fleet operator, BluSmart wanted to pivot into becoming a fleet partner for Uber. Yet now, the company is facing enormous headwinds as it tries to ride out the storm and keep its business afloat in India.
BluSmart currently operates a fleet of 6,000 electric vehicles. This incredible lineup is made up of mostly Tata Tigor sedans but includes about 180 ZS SUVs from MG Motor and makes BluSmart a fierce competitor to Uber in the South Asian market. The company recently raised $25 million in January 2024 from Switzerland-based impact fund ResponsAbility to enhance its EV charging stations. Despite this significant funding, BluSmart has faced challenges with increasing cash burns and limited outside capital.
BluSmart is deeply connected to Gensol Engineering. The current investigation has raised alarming questions about the disposal of money within the company. The regulator has made it clear that the promoters had behaved as if the listed public company was their own proprietary company. This habit has led to accusations of misuse of funds. Say for example, loan reports showing the promoters diverted funds earmarked for approved term loans. They misappropriated this money for personal expenses, including luxury real estate acquisitions and payments to family members.
“The promoters were running a listed public company as if it were a proprietary firm,” – The regulator
Anmol Singh Jaggi and Puneet Singh Jaggi, the company’s co-founders, founded Gensol Engineering. They projected an image of immense confidence in their operations, despite the increased scrutiny. They noted going above and beyond to be responsible and transparent in their practices.
“This is just an interim step, not a final decision, and I’m confident that once everything’s reviewed properly, our position will be clear. We’ve always believed in doing things responsibly, and that won’t change,” – Jaggi
BluSmart had plans to complete a fleet expansion to 10,000 EVs by year’s end. Unfortunately, it came up short. The company has recently suspended its services in Dubai. Now, it’s looking to consolidate its position in major Indian markets such as Delhi-NCR, Bengaluru, and Mumbai.
BluSmart has raised more than $486 million in total funding to date, according to Crunchbase. The company’s business model is coming under increasing pressure amid changing market conditions and growing public pressure. The initial vision of becoming an all-EV competitor to Uber has encountered significant obstacles since launching its standalone operations just before the COVID-19 pandemic.
To current day, BluSmart is testing multiple approaches to drive CRM execution in this tough environment. Each company’s future rests on its ability to ride out those financial pressures. It needs to address the issues that have been raised by the still-ongoing criminal investigation into Gensol Engineering.
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