Myles, a leading car sharing and car subscription company, has entered into a strategic alliance with MG Motor India
The Background The Indian mobility market is poised for growth of the car rental / sharing business because of idle parking of cars, a change in behaviour from ownership to pay-per-use, a rapid increase of driver cost, the spread of technology, the development of highways, the growth in domestic tourism, the young Indian middle class and changing consumer preferences. The self-drive and car sharing industry is still at a nascent stage in India. At the moment, the market consists of 3-4 major players. Over the next 10 years, this segment will see the fastest growth. Subscription models are taking the forefront in determining usage of vehicles, due to the flexibility they provide to users. The rapid scale up of subscription model aims to capture a market of close to 6 million cars that are bought in India.
The Deal: Myles, a leading car sharing and car subscription company, has entered into a strategic alliance with MG Motor India with an estimated value of USD 35 m in the first phase. This partnership will enable MG Motor India to leverage the existing network of Myles across 21 cities in addition to its own network of 110 sales and service touchpoints. It will enable the customers to experience MG’s upcoming SUV - MG Hector on a subscription basis, book test drives of the car and avail courtesy car benefits through the Myles platform. The Hector will be produced at the manufacturing facility in Halol, India, and will kick off the company’s India journey by the second quarter of 2019. IEG India Corporate Finance, under the leadership of Managing Director Mihir Kapoor, has acted as a financial advisor to Myles Automotive Technologies.
The Partners Myles provides self-drive service solutions in the car rental segment to cater the growing self-drive business demand in India. Myles is based on an asset lite model that aims to completely outsource its fleet through mobility initiatives like Angel/ Franchise program. The company looks to expand into EV to adopt the electrification and shared mobility initiatives. MG Motor India, a wholly-owned arm of China's leading automotive manufacturer SAIC Motor Corp, designs, develops and markets cars that are sold under the MG brand.
The Perspective: Car rental companies are moving towards integrated solutions by adopting franchise solutions and shifting to an asset lite model. IEG – India Managing Director, Mihir Kapoor, underlines this by explaining: “Myles has established itself as a revolutionary model in providing car rental solutions and is therefore well on its way to achieve market leadership in the segment."