India to determine Uber’s growth: CEO Dara Khosrowshahi
New Delhi: Dara Khosrowshahi, the chief executive of ride-hailing giant Uber Technologies Inc. on Thursday said he is currently focusing on his India product, though he admitted to not being sure if growth in the country would come through a merger somewhere down the line.
The presence of common investor SoftBank in Uber and rival Ola has spawned speculation that the two ride-hailing companies may unite at some point.
“I think the five-year sense is that we are going to be in the Indian market—who knows whether it will be through a merger, etc!” Khosrowshahi told reporters in Delhi.
“Right now, I will tell you my focus is investing in the Indian market, improving our product and at this point, I am not thinking mergers and acquisitions,” Khosrowshahi said.
On his first India visit, Khosrowshahi said India is a core market for the San Francisco-based firm, and that the company’s growth over the next 5-10 years will be “very much” determined by how the story plays out in India.
Discussions around a possible Uber-Ola merger are not new. In the past, Uber has deployed a similar strategy to exit markets where it faced strong local competition or felt it was losing too much money.
In August 2016, it sold China operations to local heavyweight Didi Chuxing, and about a year later, ceded Russia by merging the local unit with Yandex NV.
A CNBC report on 16 February said Uber could be preparing to sell its South-East Asia unit to Singapore’s Grab.
SoftBank nominee on Uber board Rajeev Misra told The Financial Times last month that Uber could achieve profitability faster if it focused on its core markets—the US, Europe, Latin America and Australia.
For now, though, it seems Uber will continue to plough millions of dollars to grow the business and fight off competition.
Khosrowshahi said Uber will expand its engineering team in India “three-four times” over the next year and push for the adoption of Uber Pool, its ride-share offering, two-wheeler service Uber Moto and focus extensively on UberEats, the food delivery vertical it introduced here last year.
“I think the motorcycle product is a very important product for the Indian market and also Uber Auto... Now, we are also getting into the food delivery space with UberEats, which is a very big and growing business for us globally,” Khosrowshahi said.
To be sure, Uber has about 450,000 drivers and operates in about 30 cities across India, compared to Ola’s one million drivers and operations in about a hundred cities.
Uber has been particularly focused on growing its ride share product Uber Pool, and figuring out new ways to get more car owners to drive for Uber.
While it already helps secure car loans at attractive terms through its subsidiary Xchange Leasing, Uber will work with Indian regulators to find ways to see if private number plate vehicles can be used as taxis.
“When we look at our service in most other markets across the world, we see what has created value is when we get p2p (peer-to-peer) car sharing and I think that is a very important next step for the Indian market to develop,” Khosrowshahi said.
Uber is flush with funds from a $9 billion investment from SoftBank in December and is pushing hard in existing markets. SoftBank invested about $1 billion in Ola in October.
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