Business

Currently in investment mode, India to be profitable soon: Uber

According to a new study done by Public First, a global strategic consultancy, and commissioned by Uber, “In 2021, Uber unlocked an estimated ₹44,600 crore in economic value for the Indian economy.

According to a new study done by Public First, a global strategic consultancy, and commissioned by Uber, “In 2021, Uber unlocked an estimated ₹44,600 crore in economic value for the Indian economy. | Photo Credit: BIJOY GHOSH

Cab aggregator Uber Technologies Inc. expects India to be among its profitable markets soon and is looking to add more modes of transport on the platform amid efforts to deal with service quality issues such as driver cancellations, according to a senior company official.

The company is seeking ‘outcome-focused regulation’ from the government, including reviewing some State-specific rules such as need for printers and physical meters in taxis. It is also advocating speedy implementation of code on social security as well as allowing two-wheeler and three-wheeler on platforms such as Uber across the country.

“India is a long term investment market for us,” Pradeep Parameswaran, Regional General Manager, Asia Pacific at Uber, told reporters at an interaction at the company’s office here.

“We are nearly 1,000 engineers in India building for the world. We have a large business presence...and have a very competitive market position against a pretty fierce local competitor,” he added.

He added that while the company was still in an investment mode, but “our unit economics has improved dramatically in the last few quarters. So I feel very, very good about where we are on that journey. And over time, I have no doubt that India will be a high growth market which will also be profitable...it's a steady march. I don't have exact timeline on when we will be profitable in India. But I'd say it's not it's not that far away.”

He noted that while India has been one of our better markets to work in from a regulatory standpoint, there are a “few pockets here and there” that still need to evolve.

Mike Orgill, Senior Director, Public Policy & Government Relations, APAC at Uber added that Code on Social Security is a great example of where a policy decision was made very quickly. However, the challenge now is getting the implementation done. “...not every country has figured out the issue of gig work and treatment...Australia has just starting to talk about it....India has a real opportunity to lead the world on this.”

Mr. Orgill added that a large majority of Indians still move around in two-wheelers and three-wheelers and there is a need for regulations that clearly enable such vehicles on the aggregator platform. He also stressed that as States enact aggregator rules, there is a need to ensure that these rules are focused on the outcomes. For instance, he said, Karnataka has rules that require every cab to be fitted with a physical GPS device, and a printer for physical receipt, while in West Bengal, autos and e-rickshaws cannot be onboarded on the platform and cabs need to have a roof taxi sign.

Mr Parameswaran pointed out that sometimes it's just hard sometimes to navigate regulations State by State as the company builds common technology, rules and common safety standards, and when that varies a lot by State, it becomes difficult to scale operation. “So, there's an opportunity to streamline that a bit more.”

Replying to a query on rising driver cancellations on Uber, he added that India is among the most challenged markets in the world in terms of service denial currently because of reasons such as no up front destination information, digital payment trips and increase in fuel prices. He added that the company has now addressed these challenges and in the about three weeks since implementation of new features such as destination transparent, drivers asking “jaana kahan hai (where do you want to go)” has reduced by 80%.

“At this point, we are still educating the drivers because we are still not where we want to be...not all drivers are aware of all the changes...I'd say on a scale of zero to 10, we're still sort of in early stages, but I'm very hopeful that with these changes over the next few months service quality should change dramatically,” he added.

According to a new study done by Public First, a global strategic consultancy, and commissioned by Uber, “In 2021, Uber unlocked an estimated ₹44,600 crore in economic value for the Indian economy. This includes both the impact of earnings of driver-partners and the wider indirect and induced multiplier effect created throughout the company’s wider supply chain.”

(The journalist was in Australia recently at the invitation of Uber)


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Printable version | Sep 27, 2022 11:41:03 pm | https://www.thehindu.com/business/currently-in-investment-mode-india-to-be-profitable-soon-uber/article65751162.ece