The two biggest sharks in India’s cab hailing industry – Ola & Uber – have reportedly witnessed serious slowdown in the growth of their rides over the past one year. However, if grapevines are to be believed then both companies are least surprised by this downward trend.
Industry experts claim that this downward trend is the result of both cab hailing companies’ sustained efforts to cut down on customer discounts and driver incentives. This consolidation effort is the part of their broadened effort to increase their operational efficiencies as well as profitability, analysts add.
So, what do numbers really say?
The below numbers shown in the table was originally published in a reputed business daily, after sourcing it from two industry analysts and three executives working in Ola and Uber.
Ola & Uber – yearly growth of daily rides
|Year||Rides Per Day||Growth|
|2016||1.8 – 1.9 Mn||90%|
|2017||2.8 – 3.0 Mn||57%|
From the above table, it is clear that in the current year (2018) while the absolute numbers of daily rides have grown, but growth declined to 20% on average to hover around 3.5 million. It is important to note that this drop is not only visible in taxi, but across the segments including autorickshaws and shared cabs.
Both Ola and Uber have so far declined to comment on the news report.
Industry experts believe that since both companies are in pressure to cut their cash burn rate, this downward trend in the growth of daily rides may continue for some time.
Meanwhile, Ola & Uber’s decision to cut down driver incentives has often lead to serious protest and repeated strikes by their drivers. Below is the short informative video about the same.