During the evening of dialogue between Dara Khosrowshahi, CEO, Uber and Amitabh Kant, CEO, Niti Aayog on the future of sustainable mobility and what it means for India and its emerging markets, one thing was made very clear. And that is, Uber is very serious about its business in the Indian market and India forms its core business domain.
Welcoming the CEO of the ride-hailing company to India on his first trip, Amitabh Kant congratulated Dara on making his mark as a “distinguished immigrant in the US”.
Mobility and the future of transportation dominated the focus of the discussion. On Inc42’s question of why Uber is late in opening its EV units in India especially when its rival Ola has already done it, the CEO said, “We are very supportive of EV development and we are looking forward to working with various sectors to work on EV. We think that the future of the mobility is electricity and that it is shared. Ultimately, we think it should be autonomous as well. It will be safer and cheaper for the environment. It will solve the problem of congestion as well.”
The CEO also averred on what is his vision for India, “We continue to make aggressive strides in India and we consider India as one of our forts. How we perform as a company after 10 years very much depends on our success in India.”
Speaking on the journey Uber has made so far, Dara Khosrowshahi claimed Uber has undergone transcendence along the journey.
“We started out as a car-hailing company in India. Entirely focussed on mobility whether it be cars, bicycle, motorcycle, etc. and from moving people, we are going to move everything. One of our fastest growing business is UberEats. This is very successful in India and we would like to be a part of the mobility distribution system in India. Eventually, with autonomous technology, I believe that we can be an alternative choice to mobility.”
Uber started its business in India as taxi-hailing and not into carpooling. But today, Uber has also embarked on the pooling exercises. Dara said, “So, our next step is to turn from taxi-hailing to true car sharing. So, car sharing is a very important model for us.”
Dara Khosrowshahi also emphasised that the increased service of Uber will be moving towards zero emission, and much of Uber’s future plans will also include the Indian market. Uber has already rolled out Express Pool in the US and answering to a question about when it would be available in India by Inc42, the CEO said that Uber is planning to bring the product in India and it will be “sooner than you think”.
During the dialogue, Amitabh Kant posed a very provocative question to Dara. “How did Ola beat you hands-down in the Indian market?”
Chuckling at the question, Dara said that Ola is an excellent competitor. He also explained why Ola is extremely successful in India.
“I think why Ola is really effective is because they are hyperlocal, and where we have an advantage is that we have smart engineering filling the marketplace and we serve demands minute after minute but if we want to make an edge in India then we have to be more local. I think we understand the Indian consumers but we have to build a product that is more attuned to the Indian consumers. We want our products to reach our Indian consumers more effectively.”
Interestingly, both Ola and Uber have the same investor i.e. SoftBank. So, Amitabh Kant asked the apparent question, “What is the next possibility, five years hence, are we looking towards a merger?”
To this, Dara claimed that it’s unpredictable how businesses will shape up in the next five years, “who knows what is ahead”. But, for the current scenario, Dara expressed Uber’s commitment to the Indian market and said, “Right now, we are thinking about our investment in the Indian market”.
Dara Khosrowshahi denied that there were suggestions going about for Uber to focus its business on the US, Europe and Japan market. He said that Uber has a global portfolio and, “We cover 80% of the cab-hailing market. This is scaling and ultimately, we believe that we will be able to bring solutions to people from all over the world.”
The need for diversifying Uber for different market conditions was also discussed and according to the CEO, “Companies that are solely focussed on their core markets are going to end up feeling guilty of not investing for a long-term”.
As per Dara, the transportation market is a $5 Tn market and it will be on the rise due to the increased population. Dara’s visit to India spoke volumes about Uber’s intentions and his take on the future of mobility for India.
Dara Khosrowshahi stated, “Mobility service and transportation as a service is something that is available to everyone. Challenges are always there but we have a strong team on the floor and we have a strong product and the product is what makes us keep going. It has been five months since I joined Uber and in the near future, we hope to make more strides.”
Despite Dara’s optimism, there is a larger picture of Uber’s operations in India which is fraught with challenges. Although Uber is investing in modern technology such as flying cars and battery technology, it reported losses of around $1.1 Bn in the fourth quarter last year. In the case of India, the total revenue reported in FY15 was only $3 Mn (INR 18.7 Cr) higher than losses incurred.
On the regulatory roadblocks too, it is already grappling with the hurdles in India, Italy, the UK, etc.
With Indian rival Ola gearing up to set up operations outside India, having already launched its operations in Sri Lanka and Bangladesh, Uber will likely face tough competition even in established markets like Australia.