Categories
Brief Startups

Uber India Layoffs 25% Workforce Citing Tough Market Conditions

After laying off thousands of employees in the US, Uber is scaling down its operations in India now. Uber is downsizing its workforce in India by letting go its 25% of employees. The company hopes to reduce expenses in a bid to have smooth sailing throughout the coronavirus pandemic.

The Uber India layoffs impact employees working across departments like client and driver support, business development, legal, policy, marketing, and finance. The move is a part of a global restructuring that Uber is going through that cost 6,700 employees of Uber their jobs already this month.

The US-based major, which professed to be the top app-based ride-hailing company in India not long ago, is compensating their affected employees with 10 to 12 weeks of salary, notwithstanding offering them medical insurance for the whole 2020.

“The effect of Covid-19 and the unusual idea of the recuperation has left Uber India with no decision yet to decrease the size of its workforce. Around 600 full time positions across driver and rider support, just as different capacities, are being affected. These decreases are a piece of recently declared worldwide employment cuts this month. Today is an unfathomably miserable day for partners leaving the Uber family and we all at the organization. We settled on the choice now so we can look to the future with certainty,” said Pradeep Parameswaran, President for Uber’s India and South Asia organizations,

“I need to apologize to leaving associates and stretch out my sincere gratitude to them for their commitments to Uber, the riders, and the driver accomplices we serve in India,” he included.

Uber’s declaration follows the move made by its arch-rival Ola, which laid off 1,400 employees, or 35% of its workforce a week ago.

The trouble started to ride-hailing companies from the day India declared a nationwide lockdown in late March that shut down all open transportation services. However, since the mid of May, the government has relaxed limitations that have empowered both Ola and Uber to resume few of their services — barring pool rides — in many parts of the country with the exception of those states/cities where the number of novel coronavirus cases is extremely high.

Like many other countries, the Coronavirus has disturbed the majority of businesses in India including food delivery, hospitality and travel. The new of companies – big or small – laying off thousands of employees has become a daily affair. Despite introducing new business lines, like groceries delivery, Food delivery startups Swiggy and Zomato have together downsized their workforce by letting go around 2,600 employees (with 2,100 at Swiggy alone) as their customers have decided to refrain from getting in contact with delivery boys or consuming foods prepared outside. Interestingly, just last year Uber sold its food delivery business in India to Zomato after failing to replicate the success of Swiggy.

The trouble is not just limited to food delivery or ride-hailing startups. Travel and hospitality firms, for example, MakeMyTrip and Oyo have likewise eliminated a few positions or furloughed a large number of their full-time employees lately as the demand for their offerings crashed due to pandemic. For small startups, the situation is even worse as reports indicate that 47% of startups have the cash runway of just a month only. The situation could be even worse as reports are openly indicating that 40% of Indian startups are doomed to die.

Categories
Brief Mobile Mobile Apps

Global Ride Hailing Market Subjected To A Schemed Upheaval

Be it passenger comfort or ease of booking, the global ride-hailing market is certainly not just any chance occurrence. The sure sign of the upsurge in demand for the ride-hailing services on a global level is due to the convenience it provides to the customers. However, as per recent reports by Counterpoint Research, the global ride-hailing market is undergoing a major shift.

According to the latest report, the global ride-hailing market is projected to grow at a CAGR of 21% by 2023, hedging on closely with the now-prime popularity of ride-sharing services and their service providers like Uber, Ola, Didi, etc.

Uber’s Path To A Short-Lived Global Dominance

No doubt, Uber was global, to begin with. Uber was launched in the San Francisco market, and within 7 years managed to straddle across North America and expand over other continents, garnering over more than 450 markets all over the World. With such geographical scopes, the service witnessed an unprecedented growth, setting foot, faster in the international market.

However, with that kind of growth and money heaped, higher chances of foreign clones popping up, grows. Hence, local start-ups adopt analogous business models. This forced Uber to make quick yet calculated moves to maintain its global dominance and not lose market to such clones.

Quest For Global Dominance; New Players Emerge

global ride hailing market

  • Ola is India’s biggest ride-sharing company and trails closely with Uber India. It offers a potpourri of services that starts with luxury cars and licensed cabs to Uber-type drivers and even rickshaw ride.
  • Didi Chuxing is also known as Didi Dache is often called the “Uber of China.” Apart from hailing cars, Didi Chuxing provides the flexibility of setting up a carpool or hire a designated driver.
  • Go-Jek is a motorcycle taxi service, which appears to be the main rival of Uber in Indonesia.
  • 99 cabs are available throughout Brazil, uses PayPal to process payments and is expanding into Europe.
  • Careem is available in many cities across northern Africa and the Middle East and supports advance booking as well.
  • Lyft in the US launched around the same time as Uber, yet couldn’t garner the same dominance.
  • Curb which works with licensed taxi drivers, allows customers to schedule rides up to 24 hours in advance. This taxi-hailing app is available in more than 60 U.S. cities.
  • EasyTaxi appears to be the largest service for hailing licensed taxis in the world, especially in places Uber services are banned.
  • Gett Taxi offers service in Israel, Russia and London, as well as Manhattan.

Local Players Going Global

Didi Chuxing has been expanding beyond Chinese borders:

didi chuxing global expansion

  • In 2017, Didi completed 7.43 billion rides.
  • In August 2017, Didi Chuxing announced a strategic partnership with Careem which is the leading ride-hailing and internet platform in the Middle East and North Africa.
  • In the following year, in the month of January, Didi acquired 99 which is based in Brazil.
  • It also invested in the leading player in Europe market, Taxify.
  • As recent operations are in motion, in April 2018, it marched beyond Latin America and is now operating in Mexico.

On a similar instance, Ola is also fanning out beyond borders. In February 2018, Ola started its operations in Australia.

India heightens its expectation to add 150 million+ new mobile subscribers, with most having access to 4G networks, by 2020. Ola procures the advantage of having the knowledge of the gigantic, untapped market of India and all its nuances. With $350 million, Ola is now in 110 cities across the country. In addition to this, Ola is also weighing options for a few other markets including, UK, Bangladesh and Sri Lanka.

In-The-Cards Strategem

The ground plan deduction of the current outline and that of the future of cities is an intricate process. In this case, along with the prediction of future trends, it is very crucial to understand the current demand. Again, given the current technological advances and evolution, it’s pretty much evident that a multi-modal system is necessary. The development down the road is certainly no one-solution process. Multiple and diversified transportation modes should cater to urban mobility.

It’s pretty much evident that ride-hailing service is here to hit pay dirt. However, this confidence needs to back up with the persistent push towards creating new solutions. Being a continually changing process, one can say that the ride-sharing fluidity might look different in the near future.

Categories
Business Companies Google Mobile Mobile Apps

Google All Set to Launch Its Ride-Sharing Service: Trouble For Uber?

The app-based cab aggregation industry is growing really fast, becoming highly competitive, with many challenges for the players. Despite, the market has been attracting new players at regular intervals, and the new entrant is Google. Amidst the competition and challenges, Google is all set to launch its ride-sharing service through the Waze app. Waze, which Google acquired in 2013 for $1.3 billion, is a real-time navigation app developed by an Israeli startup to help drivers learn about the traffic and road conditions on the go with the help of user comments and updates. According to the latest available report, Waze has more than 50 million monthly active users. With the intelligence and technology available related to the business, the service can be made better than the existing players in the market. Since it is a real-time navigator, the experience can be made flawless, unlike Uber and Lyft.

Yet again, Google’s aim is to make a change by solving common problems. The service is going to be very helpful and convenient as it will connect the riders with the drivers who are already heading towards the same direction. As reported by WSJ, the wage is a maximum of 54 cents a mile and a driver can perform only two rides per day to ensure that the drivers don’t make it a taxi business. Currently, Google is running a Pilot program which started in May for 25,000 area workers at firms like Google, Walmart Stores Inc., Adobe Systems Inc. Though Google is not taking any fee as of now, according to the report by Forbes Google will take a 15% cut of the transaction. This could be one of the reasons why Uber is building its own map investing $500 million.

Google’s Next Move?

The strategies indicate that Google is planning to enter the transportation industry with a slow and steady pace. This will give a tough competition to the existing players in the market. Google is planning to expand the service by the end of September. It will permit anyone in San Francisco to become a driver or rider by using the Waze app.

With Google having humongous intelligence, it might be very easy for the Giant to proceed with the idea. However, it will have to face several potential issues related to legality and safety. It won’t be a cakewalk for Google, considering Uber’s 7 years of experience in the industry and a valuation of $68 billion. Since it is not giving the service a cab aggregation’s shape, the drivers or the riders won’t be tagged as employees of Waze. It is planning to remove problematic drivers based on user review which is not a very reliable way of doing it.

“I don’t think they’ve had any significant experience in a lot of the issues that will surely arise around starting a ride-sharing business”, says Mr. Schachter.

Google Vs. Uber

The competition between Google and Uber is taking intense shape, making Alphabet executive David Drummond resign from Uber’s board. Uber had once received $258 million from Google Ventures as an investment and now both the companies are working on developing driverless cars. Google founded the project in 2009, now covering over 1.8 million miles of autonomous driving with its test cars. Uber recently acquired Ottomotto, which is a six-month-old driver-less truck startup founded by Google veterans. Uber claims that it will beat Google by commercially testing the autonomous taxis in Pittsburgh in a few weeks.

People with an insight in the matter say that Google might test its autonomous car in a ride-sharing service as it could be a potential business model. Google started testing the ride-sharing service in Israel last year. Now, the service is available in almost every part of Israel. It might have a great potential to turn the transportation industry in other countries too.

Final Words:

Uber and Google are now becoming rivals in many areas. The later one is giving a crystal clear indication of entering into the transportation industry, however, It has not yet tagged the service as cab aggregation business. The company being a resourceful giant, via Waze, will highly increase the challenges and competition in the market.

Google is apparently leveraging on its cash reserve, the services are more convenient, as well as cheaper. Therefore, Uber will face a very tough competition in future.

The question that arises is how will Uber tackle the challenge?