Uber Increases Focus On Mobility Business in India After Selling Its Foodtech Arm: Report Global-ride hailing giant Uber now plans to offer self-driving car rentals and shuttle bus services in India

By Shreya Ganguly

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Competition among ride-hailing giants to claim the top spot in the sector continues to grow each day. After selling Uber's foodtech arm Uber Eats to Zomato, the US-based ride hailing giant is increasing its focus on its Indian mobility business. According to a media report, Uber is now planning to offer self-driving car rentals and shuttle bus services in India.

Citing unnamed sources aware of the development, a Livemint report said the move is part of the company's plans to expand its mobility business in India via new products and partnerships. According to the report, the global ride-hailing giant has already formed a separate team to help it enter the self-drive rental and shuttle bus business segment.

The company has reportedly forged partnerships with mobility platforms such as Drivezy, Zoomcar, Bounce and Revv to deploy new vehicles on its platform.

In response to Entrepreneur India's query, Uber spokesperson said, "We are constantly evaluating new modalities such as auto, moto, electric bikes and buses to leverage the power of the platform and offer the best mobility experience to our riders and drivers. We have recently experimented with car rental companies so that drivers and fleet partners could access these vehicles. However, we do not have any immediate plans to launch a self-driving car rental service in India."

Uber To Lease Vehicles For Rental Services

According to the media report, for offering car rental services, Uber drivers will be connecting with the partnered mobility firms for leasing their vehicles for 5-30 days. Under this model, Uber will also not be paying drivers. The mobility platforms will be paying the drivers from the revenue generated from each completed trip.

Apart from this, the Uber car rental team will also be working towards deploying the self-driving four-wheelers from these platforms directly on to the Uber app for rental services. According to the quoted source, Uber avoids owning vehicles and this model will help the ride-hailing company to be free from asset management costs.

Uber has also reportedly done a pilot of shuttle service in India and now plans to fully launch the service sometime this year. The company is looking to offer high-capacity vehicles that can seat around 12 to 25 commuters.

While four-wheeler self-driving rental services have not been launched by Uber in any county, the company's shuttle service was first launched in Cairo in December 2018 followed by West Asia and Latin America.

Competition Intensifies Between Uber and Ola

This development comes close to the heels of homegrown ride-hailing unicorn Ola announced that its services are now live in London.

Apart from this, in October 2019, Ola launched its self-drive car-sharing service "Ola Drive'. According to a company release, the service has been initially rolled out in Bengaluru and will be eventually expanded to Hyderabad, Mumbai and New Delhi. Under this, users will be allowed to book a car of their choice by paying a security deposit starting at INR 2,000.

While Ola is focusing on challenging the US-based company in foreign markets, Uber is doubling down on its efforts to capture the Indian users. In October 2019, Uber restructured its corporate holdings to bring its India cab and food delivery business under Uber India Systems.

Prior to this, Uber's ride-hailing and food delivery business was part of Uber BV, a private limited liability company which is registered in the Netherlands. With this, Uber's agreements with restaurants and payouts which were sent via the Netherlands-based company have been shifted to India. The rides business will be invoiced out of India as well. This move is aimed at making Uber's operations "legally sound without any ambiguity". The restructure business operation was made live on October 1.

Shreya Ganguly

Former Features Writer

Covering startups and investments for Entrepreneur India. Previously a startup correspondent at Inc42. Reach out to me with interesting story ideas at sganguly@entrepreneurindia.com. 

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