Urban mobility startups that operate both two- and four-wheeler fleets are in for a rough ride with the Covid-19 outbreak and the consequent lockdown in major cities.
On Monday, the Karnataka government, as part of the lockdown, suspended cab-hailing services, such as Ola and Uber, and all forms of public transport except in medical emergencies and for procuring essential commodities.
Two-wheeler rental startup Bounce’s daily rides have dipped by 40-50% across the cities it operates in, said two people aware of the company’s operations. The startup operates in over 35 cities, including Bengaluru and Hyderabad.
Yulu, which gives out electric two-wheelers on rent, has also seen a similar dip in daily rides with many citizens choosing to stay home, said one of the two people mentioned above. The startup is also running an awareness campaign and has initiated sanitization of its bikes to help increase daily rides.
Yulu did not respond to Mint’s queries sent on Monday noon until press time.
Uber and Ola have suspended services temporarily across many cities. Uber has temporarily suspended operations in 32 cities, it said on Monday. Ola said that it will operate only a skeletal fleet to help people in emergency situations.
“Ola will continue to encourage citizens to limit travel to emergency needs as per the government’s directive. We will enable a minimal network of vehicles to support essential services in cities, wherever applicable, as part of this national effort to reduce the contagion of Covid-19," said an Ola spokesperson.
Sequoia-backed Bounce and Ola-backed VOGO have both let go of employees across technology and customer care operations after many temporary contracts expired and as ridership dipped, said the two people mentioned above. A VOGO spokesperson confirmed the layoffs were because of contractual workers leaving.
Digital news platform Entrackr had reported about the layoffs last week.
Over the past two years, mobility startups such as Bounce, VOGO, and Yulu have witnessed rapid growth, especially across the last-mile travel segment. From entirely depending on Uber and Ola for daily commute, two-wheeler options such as Yulu and Bounce are increasingly becoming the default option for many office-goers.
Bengaluru, where Yulu, Bounce, and VOGO are based, was put on a complete lockdown last Sunday and many companies urged employees to work from home. This has greatly impacted the operations of mobility startups.
On Monday, when Covid-19 cases touched 26, Bengaluru witnessed thin traffic. Only essential services were allowed to operate. Bengaluru Metropolitan Transport Corporation, which operates intra-city bus services, said it is operating on 50% capacity with just 3,000 buses.
Bounce CEO Vivekananda Hallekere said that the company’s bike-sharing operations were temporarily shut down in Bengaluru on Sunday because of a nation-wide curfew and he is prepared to meet with officials to press for declaring mobility products such as Bounce as an “essential service".
“Hyderabad’s daily rides have gone up by 5% this week compared to previous weeks, while Bangalore’s daily rides are down 20% (this week)," said Hallekere.
State governments have the legal power to classify any service or product as essential after the Essential Commodities Act was enacted in early March to ensure easy availability of basic services.
“Many state governments have asked to hold off two-wheeler sharing solutions in Hyderbad already, and we are meeting with the deputy chief ministers of different states to help classify Bounce as an essential service…We have made arrangements and have moved a few bikes into (parking) hubs for safe parking," said Hallekere.