Chinese bicycle sharing startup Ofo has decided to wind up its Indian operations as part of the firm’s new global strategy. The unexpected development comes barely six months after Alibaba backed Ofo had launched its services in India with an aim to create robust bicycle sharing ecosystem in the country. Although the company declined to comment on the main reason for exit, sources cite fund crunch to be the main reason behind closure of operations.
“We are shutting down our country operation. It is part of a global strategy to shrink the footprint,” said Rajarshi Sahai, Ofo’s director of public policy and communications.
Ofo started offering services to India’s bicycle enthusiasts in January by putting its specially imported dockless bicycles at several college campuses and landmark places across prominent cities. These cities included Pune, Chennai, Coimbatore, Indore, Ahmedabad, Bangalore and Delhi. The Chinese startup had signed MOU with civic administration authorities of these respective cities.
The company gave first big hint about its exit strategy after completely shutting down operation in Coimbatore last month. It will now reportedly wind up operations in rest of the Indian cities in next 60 days.
“We want to leave the country on a positive note. We have completed 1 million rides across seven cities in 10 weeks of operations. I hope that the other players in the ecosystem will take the opportunity to grow,” Sahai added.
Apart from India, Ofo is shutting down operations in several international cities as well. The company has announced that it will make an exit from Australia, with several reports claiming that other countries may soon add to this list.
Interestingly, Ofo’s announcement about its exit from India has come barely a month after its local rival Mobike launched operation in India.
Now will Mobike meet the same fate as Ofo is yet to be seen? But the latter’s unceremonious exit is good enough to suggest that Mobike’s road ahead in India looks pretty challenging.