According to media reports, CarTrade Tech to shut down the recently acquired OLX auto business, citing challenges in unit economics. Although CarTrade will retain OLX’s classified business, the auto unit will cease operations. In a deal valued at Rs 537 crore, CarTrade acquired OLX Autos C2B, also known as Sobek Auto India, along with its classifieds business, with the aim of generating synergies between the two companies.
Earlier this year, OLX, owned by Prosus, exited the auto business and closed operations in several countries, affecting approximately 800 employees globally. CarTrade’s decision will also lead to a reduction in its workforce.
CarTrade, benefiting from an increase in second-hand car purchases amid the pandemic, made its debut in the stock market in 2021 with investments from Temasek Holding and Tiger Global. The company faces competition from Spinny, Cars24, CarDekho, Droom and other players in the industry.
Additionally, CarTrade was reportedly in negotiations to acquire troubled car servicing startup GoMechanic at a valuation of USD 30 million, a significant decrease from its previous valuation of USD 283 million after the startup admitted to misleading investors and non-compliance with financial regulations.
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