Hyundai is developing the vehicles under its “Smart EV" platform. These “special purpose vehicles" will be designed and developed specifically for ride-hailing applications, they added.

“The investment in Ola was made with an intent of testing these vehicles as electric mobility in India will gain traction in cab services rather than personal usage. The electric vehicles will be launched most likely in 2021, but with Hyundai’s capability, it can hit the market in 2020 as well," said the first person cited above.

In March, Hyundai had announced a $300-million investment in Ola in a bid to become a complete mobility solutions provider. The deal involves both Hyundai and Kia working with the Bengaluru-based startup to develop customized electric vehicles and charging stations suitable for ride-hailing services. This followed a ₹100 crore investment made by Hyundai last August in Gurugram-based car-sharing platform Revv.

Kia Motors Corp. is a unit of Hyundai, South Korea’s largest automaker.

The first person cited above said Hyundai can supply the vehicles under the brand names of both Hyundai and Kia to Ola, or decide on only one. He, however, added that details such as production plans are still being finalized as the products are still under development.

ANI Technologies Pvt. Ltd-owned Ola, on its part, is scouting for various types of electric cars as part of its strategy to convert 20% of its fleet to electric by 2021.

The plans received a boost with the Indian government earmarking ₹10,000 crore to promote electric mobility for three years till 2021 in the second phase of the Faster Adoption and Manufacturing of Electric and Hybrid Vehicles (FAME) scheme. Under the scheme, subsidies on vehicles, except two-wheelers, will be offered only to commercial fleet aggregators.

“Hyundai knows that in India and other parts of the world, electric mobility will be first adopted by cab service providers and other commercial fleet operators. The investment in Ola gives it a ready-made platform to test its vehicles. While, for Ola, this will help it induct quality but low-cost electric vehicles, custom made from one of the leading manufacturers in the world," the second person said.

Ola Cabs, Hyundai Motor India Ltd and Kia Motors India Pvt. Ltd did not respond to emailed queries.

Hyundai is set to start its electric journey in India with Kona this financial year. The vehicle will be assembled at its Chennai factory.

Suvranil Majumdar, project lead, electric mobility, International Finance Corp., said most vehicle manufacturers have realized that electric vehicles will be used initially by fleet operators. Hence, they are collaborating with them so that their vehicles can be used in the fleet of such operators.

“Hyundai’s approach is quite good since supplying electric vehicles to commercial fleet operators is also financially more viable than selling them to retail customers, and companies have also changed their strategies accordingly," Majumdar added.