While Uber gained traction in early days with the idea of letting people use their vehicles to give rides and make money, things were always much different in India. Uber and its local rival Ola work with vehicles that have commercial licences. Now however, the government is opening up to the idea of allowing private vehicles to be used with ride sharing platforms and is reportedly assessing the impact of the same.

While this appears to be a positive step, the impact might not entirely be positive. The objective here is to reduce congestion and the impact on environment with ever increasing number of vehicles. Allowing private cars on the platform would make more cars available for catering to ride requests making it more accessible and could, in turn, motivate more people to ditch their vehicles and rely on sharing services for transportation.

However, this would cause trouble for Uber and Ola with their current fleet of drivers. The driver partners have already been pressurising the companies to stop shrinking incentives and have been expressing their inability to pay for even car ownership in some cases. There are stricter regulations and considerably higher costs associated with commercial vehicles which means in its current form, the system would favour private vehicles. And while the objective is also to cut down on emissions, it is also worth mentioning that in some parts, Uber/Ola vehicles run only on CNG and no diesel powered cabs are allowed to operate. The same should also apply strictly to private vehicles because of the environmental concerns. However, the infrastructure to cater to CNG vehicles is still very limited in terms of capacity and presence.

To add to that, the attractive earnings resulted in a surge in the number of commercially registered small hatchbacks and sedans. It is not uncommon to find dozens of yellow plate cars waiting for the next ride during off peak hours. A fraction of them are novice, unskilled drivers lured by the higher potential payout compared to whatever else they were doing. This situation could have been avoided by opening up to the idea while the government was resisting the expansion of Uber and Ola despite a broken urban transportation system.

There are other challenges as well. Security is the biggest concern of them all as entry barriers for drivers are lowered. Another question is if this would really get car owners to share their vehicles or if this would just be another channel for cab operators to expand their fleet at lower costs. But this could also be the start of a change in transportation. If the trials work out fine, it could also inspire relaxation in car sharing regulations making it easier for rental businesses and thus for the masses to share vehicles.

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Audacia Capital, licenced under the Dubai International Financial Centre (DIFC), recently announced in a statement that it has acquired 25% stake in ekar. ekar is a car sharing startup based in Dubai and will use the capital to boost its cooperation with Dubai Roads and Transport Authority, Etihad Airways and Emirates Airlines while also expanding the service network and inventory size.

“Audacia Capital has always been supportive of UAE founded companies. The ekar business model is offering consumers a unique service that isn’t available in the market. ekar is also working in alignment with the UAE Government’s vision to promote sustainability and economic growth and car sharing will serve to be very beneficial for this purpose in the long run. We are pleased to have started this partnership and we are confident that ekar will in no time become the leading car-sharing scheme operator in the GCC,” said Emad Mansour, CEO, Audacia Capital.

The investment bank hasn’t revealed the size of deal. It is being reported that ekar plans to raise a series B round within the next 18 months. The startup officially launched in January 2017.

“With this investment, ekar has the financial capacity to both expand its current operations with the Roads & Transportation Authority (RTA), Emirates Airlines, and Etihad Airways as well as to add new carshare programmes for city and private fleets. We aim to have over 1,000 ekars over the next 3 years across the GCC including Saudi Arabia,” said Vilhelm Hedberg, CEO ekar.

“The ekar RTA Dubai Car fleet of 100 ekars are available for booking from convenient metro locations and city locations, easily discoverable via our ekar App. User counts continue to grow, and we are already seeing trends in consumer behaviour, with many members utilising ekars multiple times daily. Further, our existing business with Etihad Airways and Emirates Airlines continues to grow, and we have begun expanding our focus to international airports, a clear next step for ekar. The ekar Book Now, Book Later option is ideal for tourists looking to plan ahead for their trips, and is also gaining increasing popularity with public and private companies looking to optimise its own car fleet. Typically, a carshare programme can bring about a 35 per cent decrease in company fleet size, which in turn reduces company costs and depletes overall carbon emissions,” he added.

Boston Consulting predicts that by the year 2021, 35 million users all over the globe will be booking rental cars for over 1.5 billion minutes per month. The annual revenue from rental services is expected to reach USD 4.7 billion.

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Sharing, or rather the access economy is becoming a part of our everyday lives even without us noticing. Taking UberPOOL to work, booking a homestay on Stayzilla, renting a mountain bike at a hill station, all of these have become common practice. Our upcoming report indicates that over the past five years, the sharing space has seen the maximum investments in APAC, higher than any other industry segment. As you would expect, most of this capital has gone towards transportation solutions.

(L-R) Karan Jain, Co-founder & COO, Anupam Agarwal, Co-founder & CEO, Revv

Car rental companies form a major part of it and recently Anupam Agarwal, CEO and Co-Founder, Revv, joined us for a conversation about the same. We discussed the car rental market in India and how it is going to shape up in future. Here is an edited excerpt from the conversation:

There are multiple players in the car rental space in India. Do you see that as a challenge or is the market big enough for multiple players?

I believe that is not a challenge for us and it won’t be anytime soon. The market is much bigger than what any of us can provide at this point. India is likely to become an opportunity for 100K shared cars in 3-5 years and out of that, today there are maybe 4,000 on the road. I don’t think the industry faces the question of intense competition in the space but of how to create a supply right now in a non-linear manner. Not having to buy everything. That is the first challenge.

Next would be to create awareness. If you go out and ask random people, you will realise that a large fraction of people aren’t even aware about the availability of car-sharing options available to them. These are the two main challenges that we need to bother ourselves with right now. There is space for many players and even in long run, there will be two or three major players occupying more than half the market with the remaining being occupied by long chain of small players.

What is the nature of users currently renting on your platform?

Right now, close to 60 percent of the demand is coming from outstation travellers. The remaining usage primarily comprises of people who will be driving in the city. This fraction includes people who hire over weekends to go around with their friends and the people who rent cars at their destination during their multi day visit.

At this point, there are not a lot of people who are using our service everyday but there certainly are people using it on a weekly basis.

And what about daily commuters? Are they opting for products like Revv to work?

The response for Revv to Work has been quite good. We have committed 15-20 percent of fleet for that product and we are almost always sold out on that component. We often receive calls from customers demanding us to increase the available inventory for Revv to work. However, we can’t really commit our entire inventory toward it because then we won’t be able to offer the same level of availability for travellers looking to rent short term.

Globally car makers are actively involved in sharing businesses, either with their own spin-offs or with partner startups. How do you think Indian car makers see rental companies?

I believe Indian manufacturers are warming up to the concept and we will see some major developments soon. Practice of car ownership will fade and an alternative model will replace it. Close to two percent of Indians own cars and that is a very small fraction when compared to say 80 percent in US or even 20 percent in China. Now if we look at the urban India, if that 2 goes up to even 5, the state of our roads won’t be pretty. Increase in access to cars through ownership won’t really work well here and sharing will allow sustainable growth.

What are some conditions you think are unique to the Indian market? Do you face issues working with insurers or regulators?

The challenge with insurers isn’t something that can be addressed immediately but yes, we would like some change in future. The fact that insurance here is associated with the vehicle and not with the driver limits us in some ways. If that is not the case and common records are maintained here as well, we will be able to offer better service and personalisation on various levels. We will be able to offer better prices to someone with a better record while retaining the standard prices for someone with a bad history of driving. However it won’t be easy for the industry to rearrange itself anytime soon.

About the regulators, we would love to have some more support for a marketplace model. Currently there are licences we are supposed to acquire for individual states which is not a problem for us at all. However, when we look at a collaborative model, the licence becomes a bottleneck in allowing other commercial cars from the road to be a part of the network. The owners need to acquire the licence and have to fulfil multiple conditions and have a certain scale of fleet. There are of course security reasons behind the barriers but a middle ground has to be found. They need to open up to the idea of platforms like ours taking the responsibility for the individuals willing to share. The regulation can be made around the company generating the supply and renting out the vehicles rather than the owner to make room for a true sharing model.

Do you think the likes of Uber and Ola have helped you?

Absolutely. In a big way. They have spearheaded this revolution and now there is a whole class of youngsters who don’t want to put their money on buying a car. In my own circle, I was the last person to buy a car and was very happy living with Meru Cabs for my needs till then. Back then however, the options were limited and I eventually had to buy one for all the outstation travel that wasn’t always possible with cabs. With the options available today, I wouldn’t have done that.

What channels have you been using to drive the demand for rentals?

For us, marketing hasn’t been a real challenge. We have been growing organically with some social media marketing and word of mouth. Whenever we have added to our fleet, the utilisation has automatically surged indicating that there is a good amount of latent demand in the market. More than the demand, we need to work harder on ramping up the supply and educating more people about the product.

What next can we expect from Revv?

We started with the vision of turning the two percent ownership into a 50 percent usage. We believe that at least half of the population should be able to access a car when needed, something only a car sharing solution can help accomplish. Of course adding new geographies is going to be one part but along with that, you will see expansion of the services we are offering with entirely new products.

There is a segment of users which has given up on the idea of car ownership and their varying needs cannot be taken care of entirely by the current product. If you are in a new city for a few months, you might want to have a vehicle for the period. With our current structure, that won’t be possible. However, going forward we are looking to cater to these customers without the baggage associated with car ownership. There are few more type of customers we have in mind that would require us to add new products. We want that all your transportation needs should be taken care of between us and the likes of Uber and Ola.

Outside of your business, what are the major transitions you see coming to the ground transportation space in long term?

One is certainly going to be electric vehicles. They are already gaining momentum in some parts of the world and in future, expect the intracity transport to go entirely electric. The developments in battery technologies driven by the likes of Tesla will help this further.

Another major change I believe would be the reduction in size of vehicles. A large number of people move alone in their vehicles and eventually we will see more vehicles tailored to that. We could possibly see modular options to cater to varying needs of travellers. Third will be sharing which of course we are a part of and in long term, it will be further driven by the entry of autonomous vehicles. Instead of owning, people will choose to access the resources as needed.

You can find more details about Revv on their website www.revv.co.in.

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Self-drive car rental marketplace JustRide has raised USD 3 million in bridge funding from Susa Ventures, Kima Ventures, Axan Ventures, SCM Holdings, ITFarm and Y Combinator partners Justin Kan, Qasar Younis and Paul Buchheit. With this fresh injection of funds, the company is looking to scale up the fleet size and develop new technologies for smart vehicles.

The startup was a part of Y Combinator’s summer batch and has previously received funds from the accelerator. After switching from an aggregator model to a marketplace model earlier this year, JustRide is looking to scale up the fleet from 300 to 2000 adding close to 300 vehicles per month. Along with this, they will put more funds towards JustConnect, their car sharing platform. The funds would also go towards further pushing Yabber, an IoT device to track driving analytics to be used for car sharing.

According to the news report by ET, JustRide has an annual GMV of USD 3.5 million and USD 1.5 million in net revenues currently. Abhishek Mahajan, CFO of JustRide claims that according to their projections, the company will be profitable when they have 500 vehicles in the fleet and will clock an annualised GMV of USD 5 million. The company is also looking at a higher round of USD 7 million from the current investors to further invest in the in-house Smart Vehicle Technology.

Source: ET

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Sharing is the future. We don’t want to own assets anymore, we just want to have access to them when needed. The earlier brands adapt to this behaviour, the better it is for them. Toyota has made a move in this direction and is now looking at helping people share cars. In order to do so, Toyota Motor Corporation will establish a Mobility Services Platform (MSPF) to collaborate with various service providers. The MSPF will have various functions to support mobility services, and leverage the Toyota Smart Center (TSC), the Toyota Big Data Center, and financial services.

Shigeki Tomoyama, President of Toyota’s in-house Connected Company stated: “As a mobility service platform provider, by collaborating with various companies and services, we would like to help create a new mobility society in order to offer safer and more convenient mobility to our customers”

The key highlight of this new development is the key, or rather the lack of it. Toyota has introduced a Smart Key Box that owners can install in their cars without any modification. Anyone sharing the car will be a sent a code through an app which will be authenticated via Bluetooth when they bring their phone close to the car. The access time and duration will be managed on the basis of booking time.

For sharing services, this eliminates the need of physically handling the keys or the controlled area network systems used by most rental companies. The idea of replacing car keys with phones isn’t exactly fresh and Volvo announced a similar feature on certain car models in the past to enable sharing through Sunfleet. However, the solution offered by Toyota can be retrofitted to existing vehicles enabling easy adoption and implementation.

The technology will be put to test in a limited pilot in San Francisco starting January 2017 in association with car sharing service Getaround. Last month the Mirai Creation Investment Limited Partnership, a fund in which Toyota participates, provided strategic investment to Getaround.

“Our goal at Getaround has always been to empower people to car-share everywhere,” said Sam Zaid, Getaround’s Founder and CEO. “Integrating our experience and purpose-built car-sharing technology with Toyota’s activities across mobility services opens up new opportunities to Toyota customers and the rapidly growing car-sharing market.”

By easing the sharing process, Toyota will be able to get more people to share their vehicles while allowing them to recover some of their ownership costs. In markets like US where a large number of vehicles are leased, people will be more open to the idea of sharing their cars. Many other automobile companies are exploring the sharing space recognising the opportunities. Toyota is further planning to get more people to share their vehicles by creating a new financial product to enable people to pay off their car lease with car-sharing programs.

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India is a big market for the American cab hailing company but not without the unique challenges. Apart from the local rival Ola, low internet penetration and slow adoption mean that the large number of rides they complete are still a very small fraction of the entire cab market.

Accounting for the challenge of slow connectivity and low end devices, Uber earlier introduced a simplified mobile web version at dial.uber.com to allow people to book cabs without the need of downloading the app. Taking another step in the same direction, Uber is looking to associate with Indian Railways to allow for train travellers to book an Uber easily.

While there is no confirmation from either parties yet, some news reports quote railway officials confirming the development. According to the reports, the proposal is being considered and a revenue model is being worked out.

Uber is looking to lease out space at railway stations to make cabs readily available and set up kiosks to allow for passengers arriving on a train to book cabs easily. Some sources suggest that Ola is also looking at a similar partnership. Ola also recently started offering cab service to Mumbai Metro passengers by setting up Ola Zones.

With the massive scale of train travel in India, if Uber is able to attract even a small fraction of travellers, there will be a huge bump in the number of rides. With 12,000 trains daily, Indian Railways carries over 23million passengers everyday across 8000 stations. For railways, it would open up a new revenue source from the lease, commissions and service charges. Along with that, the railway stations will be able to provide better cab service to the travellers.

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As more people look away from the ownership model and get acquainted to the idea of sharing, car manufacturers all over the globe are facing challenge in selling cars. Luxury car makers are even worse hit and to deal with the change, they are dipping toes into the on-demand economy. All over the world, we have seen the car manufacturers take steps to be a part of the sharing trend. In yet another such step, BMW has signed a MoU with Ola to provide on demand luxury cab service in India under Ola Lux.

Introduced earlier this year, Ola Lux allows users to book premium vehicles in selected areas. Ola Lux has presence across three cities in India and offers an array of premium vehicles from luxury brands. The cab hailing company plans to double its revenue from the segment.

With this association, BMW vehicles will be made available to Ola fleet operators through easy ownership and maintenance options. The German car maker will offer 360 degree solution for pre and post sales support throughout the lifecycle of vehicle. BMW Financial Services India will offer attractive financing options while the brand will also offer assured buy back option for the car on completion of the contract.

This is an interesting move from BMW to give its sales a push in India which is otherwise a slow market for the brand. Through Ola Lux, BMW will be able to get more vehicles on the road which in turn could also give a push to the direct sales as more high income individuals get to experience the vehicles through the sharing service.

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Automobile companies can’t afford to ignore the huge opportunity Chinese market offers. Apart from being a huge car market, it is also a big market for related transportation services. The latest validation of this massive opportunity comes in the form of an investment by General Motors in Yi Wei Xing. Yi Wei Xing is a leading car sharing technology provider in China and its product Feezu offers convenient car rental and car sharing experience.

Along with this, the company also offers a customisable cloud based car sharing platform for other car rental companies. GM says that it is another move in exploring personal mobility in China. GM has been on a drive to explore new models for car sharing and launched its car sharing service brand Maven earlier this year. The service was expanded to multiple markets over few months soon after the launch in January.

“Every market has its unique requirements for car-sharing services,” said Julia Steyn, GM vice president of Urban Mobility Programs. “Yi Wei Xing has solid technologies and innovations that will help us explore more efficient and personalized mobility solutions for consumers in China.”

The companies haven’t disclosed the details of the deal. The investment would allow GM to better understand the usage patterns in Chinese market and learn how people prefer to move. The American car maker has been making quick moves in the transportation space in a bid to be a part of the future of mobility. GM earlier acquired Cruise Automation, a startup working on driverless cars. The company also invested USD 500 million in Uber rival Lyft with the motive to build driverless cabs in future.

Other car companies aren’t left behind either. Volvo has been integrating features in vehicles to make sharing easier and has been pushing its own rental service Sunfleet. The Swedish manufacturer is also working with Uber, which recently acquired Otto, to develop driverless vehicles. Almost all the major automaker are now trying to be a part of the sharing trend for now and a driverless future in the long run which means it is very likely we will see more such developments in this space.

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As people open up to the idea of sharing resources, the market for self-driving car rental is growing. People who don’t use their cars often aren’t willing to deal with the ownership and maintenance costs or the hassles. Moreover, an increasing number of travellers are looking to explore more when they step out during their vacations which means a significant fraction prefers self-drive rentals over other options.

Revv, Delhi-NCR based self-drive car rental company, has revealed expansion plans and is looking to more than double the fleet size over the next few months. Right now the company has a fleet size of 300 vehicles with presence across four major cities. They operate on a hybrid of ownership and marketplace model and their current fleet comprises largely of premium vehicles and close to a third of the vehicles in the fleet are provided via other self-driven vehicle providers.

Anupam Agarwal, Co-Founder & CEO of Revv said, “Our concept of 100% doorstep delivery service along with our maniacal focus on customer experience has already given us strong traction and repeat-user base. We will now use this launchpad to scale-up quickly and expand our services in several cities across India. The repeat usage has been a very encouraging trend for us, in addition to the sheer width of use cases for which customers are making bookings. It has also turned our thinking towards new, innovative products which are tailor-made for upcoming and large use cases”

The company is looking to have a fleet size of 700 by this festive season. With the increase in fleet size, the company will also expand its footprint and expand operations to 8-10 cities by the end of this year.

In this space, the prime competitors are Zoomcar and Myles. Along with that, Avis has also announced plans to invest more in the Indian market which would further catalyse the competition.

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Finally some thought of adding this. In yet another first, Uber’s home rival Lyft has added the feature to allow passengers to add multiple stops along their route. We often need to take multiple stops along the route, maybe to drop a friend or buy something on the way, and as more people ditch their personal vehicles in favour of ridesharing services, it is likely that more people will need to take multiple stops along their route.

In the US market, Lyft has tried to lure people with several firsts including Lyft Line and the option to schedule rides. Both of them eventually found way into Uber and many of its clones all over. This is another feature which should keep the customers happy. In case of point to point bookings, riders would often add the first destination and then change it manually later in the journey. This however would eliminate that. Riders can add their first stop as their destination and then tap next to it to add their final drop off point.

It not only solves the problem for riders who now won’t have to explain the route to the drivers or manually update the route but will also be helpful for the drivers. The driver start getting requests from new customers as they approach their destination and a last minute change eliminates that possibility. With the route clear and final drop off point added, the system will connect them to relevant riders near the end of journey rather than along the route.

The feature will be rolling out on the Lyft mobile apps soon. The feature is certainly a useful one and we might soon see other cab hailing companies take a hint from this. It was announced through a blog post by Lyft.

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