Author: M A Sam Cedric
10th Grade, PSBBMS, Chennai
THE INDIAN TAXI MARKET- HISTORY AND THE CURRENT SCENARIO-
When we hear the word “taxi” what is it that comes to our mind first? Yes, the classic black and yellow car waiting for passengers outside the railway stations and airports. Now these cars are a thing of the past. Today we can see hundreds of taxis on the road ferrying passengers who have booked their rides through the internet with a click of a button.
The beginning of organised taxi companies-
A few years ago companies like Fast Track and Meru cabs started their operations, with drivers as employees. Riders could book through telephone and payment was done in cash.
The company would buy a car for the drivers, train them in soft skills and pay a fixed amount per day. In turn, the drivers had to bear the cost of fuel, while maintenance of the car was taken care of by the company.
Some companies owned the car throughout its lifetime, while others, like Easy Cab, had an arrangement wherein after five years of driving, the car was owned by the driver.
2010 was a historic year for the taxi business when Ola entered the scene. Couple of years later Uber joined the race. By this time booking a cab was one of the easiest things that could be done.
One simply had to pull out their smartphones, enter the app and book a taxi. It was the beginning of a revolution in the ‘cab-hailing’ industry.
The major companies-
The Indian taxi market is dominated by 2 major companies. Uber India (Uber India Systems Private Limited) and Ola Cabs (ANI Technologies Private Limited). By 2020, Ola Cabs had started functioning in around 130 cities in India, while Uber India was functioning in around 55 cities. In 2020, 74.65% of the total revenue of the taxi services market in India was earned by Ola Cabs, whereas, Uber India held a share of 20.07% in the market. Other companies in the market include Mega cabs, Meru cabs, Fast Track.
The internet and Ola and Uber-
Companies like Ola and Uber have made use of the internet efficiently. The use of the internet made a big difference in how the smaller cab companies functioned as against the giants- Ola and Uber. The idea of booking a cab through an app was really attractive to the users. GPS location and detailed information about the driver was an added attraction for the customers.
The major problems
While Uber and Ola are battling for a large share of the massive Indian market, people who have invested in it are still waiting for it to make profits. However, the customers seem to be satisfiedwith the services provided by them.
Unfortunately, there are problems attached to the system. The drivers face the most difficulty as they buy cars on loans and find it difficult to repay the debt. This is because they do not have much left at the end of the day. Promises made when companies start operating connect tens of thousands of drivers with them. That rosey picture doesnt& exist once they start driving around.
Problems penetrate to the riders as well. Frustrated drivers engage in heated discussions(sometimes, even physical assaults) with passengers. Many drivers cancel rides because the trip is not lucrative, leaving their rides in lurch.