Ola, Uber like services face tough competition from these newer mobility startups as market share drops

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Updated: March 12, 2020 6:19 PM

Unavailability of cabs and autos during peak hours, lower estimated time of arrival in heavy traffic conditions for bikes, and being more affordable has worked in favour of bike taxis.

Cab-hailing services remain the dominant player in the digital mobility market (file photo)

The proliferation of multiple models in the mobility space such as bike taxis, autos, car or bike rentals, carpooling, last-mile mobility etc. seems to be eating into the share of a single user or sharing services of players such as Ola and Uber. The gross book value (GBV) of the online mobility space, which has increased from $1.8 billion in 2017 to $2.4 billion in 2018 and $2.9 billion last year, is seeing a gradual decline in the share of cab-hailing services, according to data from management consulting firm RedSeer. While cab-hailing services such as Ola and Uber remain the dominant player in the market but its share in terms of GBV has been eroded from 89 per cent in 2017 to 84 per cent in 2018 and further down to 76 per cent in 2019.

“P2P cab taxis contribute to the bulk of the online mobility market in GBV terms. However, the market is shifting towards rapidly growing bike taxis and other emerging models including car/bike rentals, car-pooling and self-drive models,” RedSeer said. Ola and Uber themselves have been quite active in autos, bike taxis, carpooling and rental markets along with players such as Jugnoo, Rapido, Quick Ride, Zoomcar and Drivezy in the respective markets while Vogo, Bounce, Yulu, etc. have occupied the bike rentals and micro-mobility sub-segments in the overall market.

Uber declined to comment for this story. Comments from Ola are awaited.

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Also, the boom of these services has started to perhaps impact the annual number of rides through online cabs such as Ola and Uber. In approximate figures, the number of annual rides for such P2P cabs has marginally declined from 760 in 2018 to 740 in 2018 while it had increased from 600 in 2017. The fall has been due to “focus on profitability by players and decreasing supply incentives leading to supply churn and dissatisfaction and the advent of cheaper and more convenient models like bike taxis,” according to the RedSeer report. Moreover, unavailability of cabs and autos during peak hours, lower estimated time of arrival in heavy traffic conditions for bikes and being more affordable has worked in favour of bike taxis. As a result, the number of annual rides for bike taxis has increased from 10 in 2017 to 30 in the following year followed by a whopping jump to 130 — around 4.5 times growth last year.

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