The San Francisco-headquartered company also claims that 3% or 30,000 of its taxis, including cars, bikes and autos, are electric, making it the ride-hailing platform with the biggest electric fleet in the country.
“We have made significant progress for the last two to three years. We are seeing more trips on two-wheelers and three-wheelers today than four-wheelers. I’ll say there are a little more than 500,000 two-wheelers and three-wheelers. Remember, we were always the car-based service for the longest part of our business,” said Prabhjeet Singh, president of Uber India and South Asia, in an interview with Mint.
“These (bikes and autos) tend to be lower-priced products. (However) they are among the fastest-growing parts of our business. Our core car-hailing business is growing in the mid to high 20s year on year, and this segment (bike taxis and auto) is growing much faster. So if more than half the trips are happening on two-wheelers and three-wheelers, about a third of the revenue will be coming from these categories,” said Singh.
More two-wheelers, autos
Uber, which started operations in the country in 2013, launched its two-wheeler service Uber Moto in 2016 and started getting three-wheeler autos two years later. However, the platform saw a significant jump in the last two years.
The cheaper cost of ownership of bikes and autos compared to buying a car is one reason why more people are looking to join ride-hailing apps like Uber. However, this rapid growth in the two-wheeler and three-wheeler space could also be due to working-class people looking at end-to-end transportation as more cities see a rise in Metro line connectivity.
“Bike taxis and autos are preferred for shorter commutes. In a city like Mumbai or Bengaluru, getting an auto alone is difficult if you intend to travel a short distance. Here, an app like Uber is useful,” said Neil Shah, vice president and partner at Counterpoint Technology Market Research. “As metro networks expand in bigger cities, people are looking at auto and bike taxis as a preferred option when commuting from work to metro station and then again from office to metro station.”
Back to food delivery?
Shah of Counterpoint Technology believes Uber could enter the food-delivery space again because the company may want to optimise using bike taxis during non-peak hours.
For now, Uber’s focus remains steadfast on mobility, ensuring that it continues to provide efficient and reliable transportation services to its users.
“Today, two-wheeler drivers offer mobility services. Many times, they also deliver packages. We already have a work package product available, and drivers like that because there are certain hours of the day when they tend to find more demand for carrying packages, etc. Right now, we are very much focused on the mobility pie. The two-wheeler ride-hailing business itself is so under-penetrated. We are obsessed with building that out. (But) Never say never to other opportunities,” said Singh.
Uber sold Uber Eats to Zomato for $206 million in 2020 as part of the restructuring undertaken by the CEO Dara Khosrowshahi, who was brought in to turn around the company in September 2017. Uber also got a 9.99% stake in Zomato as part of this transaction. By the end of August 2022, Uber sold its entire stake in Zomato for $376 million.
Zomato, at the end of Wednesday, had a market cap of $27.7 billion.
Sale of stake in Zomato
Singh’s take on selling Uber’s stake in Zomato is philosophical. “Hindsight is always 20-20. I think you can always look back at multiple instances where you could have done things differently. But the idea is not to dwell on that. I think at that time, we had to take calls on the portfolio when we had to as part of a global strategy, and Dara took decisive calls at a time that made sense for the business,” said Singh.
Uber’s 9.99% stake in Zomato would have been worth $2.7 billion. It was sold for $376 million by the end of August 2022.
Singh, who joined Uber in 2015 and became the president of South Asia, which includes its business in India, Sri Lanka and Bangladesh, in July 2020, maintains that Uber is the largest ride-hailing app in the country.
Saftey is paramount
For now, safety remains at the heart of Uber’s growth. The company claims that it is the only ride-hailing app that does background verification using a third party of a driver before the driver joins its app.
“We maintain a rigorous vetting process for all drivers prior to joining as a driver partner, starting with comprehensive background verification and strict onboarding requirements,” said a spokesperson for Blusmart. “This includes verifying personal identity documents, conducting an independent third-party background check for criminal history and address verification, and obtaining a No Objection Certificate from the state police. Additionally, drivers must pass driving tests, undergo a behaviour and aptitude check, and complete training on safety protocols.”
An email sent to Ola Cabs seeking comment went unanswered.
Uber, which went public in 2019, had a revenue of $37.3 billion in the year ended December 2023. In the latest quarter, Uber reported revenue of $10.7 billion and profit of $1 billion from April to June.
Uber does not share the financial performance of the countries it operates in beyond stating that Brazil and India are the second and third largest markets for the company.
Investing in the future
“I can choose to be profitable tomorrow. But the choice, as Dara mentioned during his India visit earlier this year, was the profits we are generating in parts of the portfolio are being invested in new categories,” said Singh.
On proving social security to its over 1 million drivers, who are not employees of the company but gig workers, Singh said the company is waiting for the government to implement the social security code for gig workers.
“The social security code passed by Parliament two years back is, I would say, the breakthrough landmark bill, which should be the gold standard for every gig economy globally. Unfortunately, it has not yet been notified and implemented. We at Uber are advocating its implementation. I can tell you, within one hour of that (the social security code) getting notified, we will put in whatever (is) our commitment towards that code,” said Singh.
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