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Case Study: Taxi Aggregator, Uber focused to become profitable in India soon

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In March, SoftBank, the largest investor of Ola declared that the taxi aggregator has grabbed 85 percent of the country’s taxi market. Now, the CEO of Uber, Amit Jain claimed that Uber is also as big as Ola in the country when it comes to completed trips.

Last week, Uber raised a fund of $3.5 billion translating to Rs 23,000 crore from the sovereign wealth fund of Saudi Arabia. It will continue to invest in the country in order to increase the pool of drivers, add categories like bike taxis, and improve technology.

As per Amit Jain, the latest funding round is for the Indian and Chinese markets as these will be the prime focus areas for the taxi aggregator Uber. For now, India is the third largest market for Uber in terms of total number of trips. He added that they will continue investing and growing the operations in the country. They operate in 27 cities in the country and they will get started with their journey in more cities as well.

He added that, with time, a bigger portion of their supply will be from the leasing program. They will add more features and ramp up their focused technology team to over 100 people. They will make heavy investments in maps to make them better and smarter.

In the Indian market, Ola and Uber are equally big with 50 percent market share each. However, he added that Uber is driven by ambitious goals and the team is focused at the total number of rides and compares the same with the percentage contributed by Uber.

Uber gets the demand from the affordable and low-cost categories – UberX and UberGo, So, they are highly focused on growing in these segments. They are also working to get licensed bikes and cars from private users on the road. The next major frontiers for them are UberPOOL and ride-sharing.

The company aims to get profitable in India by getting supply efficiency and investing in the foreseeable future. Right now, they are not profitable. Their major objective is to make their service efficient for the drivers and consumers.

Will the strategy of investing work for Uber in India? Will Uber be able to grow outshining Ola that is claimed to be the market dominator? What kind of service should Uber focus on?

 

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