We will expand to cities other than Bangalore in few months: Jambu Palaniappan of on-demand car hire service Uber
San Francisco-based Uber Technologies Inc, which provides mobile-based on-demand car hire services in 44 cities across 18 countries globally, is one of the heavily invested online car hire services in the world, with Google Ventures along with a few other investors infusing more than $360 million in August this year. The company is launching operations in India, with Bangalore being the first city to be picked for expansion. It has already been running a pilot in the city for several weeks.
Besides Bangalore, Uber wants to see itself present in all major cities in the country soon. In an interview with Techcircle.in, Jambu Palinappan, Uber's head of EMEA and Indian expansion, talks about market opportunities, growth plans, and more. Here are excerpts:
Why did you prefer Bangalore to other cities to launch your operations in India? By when do you plan to look at other cities?
Bangalore is the IT hub of India; we see a lot of opportunities in this market. The city is growing fast and so is the migrant population. It is home to thousands of multi-national companies and we see opportunities in the corporate segment too. In fact, Bangalore is almost similar to San Francisco in terms of the acceptance of new technologies, innovation, etc. The environment is conducive and people are comfortable with tech products, services and infrastructure.
In addition, Bangalore has long been welcoming new ideas, people and cultures—from nurturing global tech giants in the last decade to opening its doors to young startup founders and a growing number of expats today. However, there are many transportation challenges in this city. We are here to address these. Uber is looking to provide a reliable, quality and cost-efficient service to our customers. We started a pilot in this market a few weeks ago and the response has been phenomenal. We are looking to capitalise on that.
We have formed a small team here. We now want to be present in all major Indian cities very soon.
You are considered to be a high-end service provider and operate only premium cars. Will you follow the same model in Indian as well?
It is wrong to say we offer high-end services. We are operating only premium cars; but it does not mean we are targeting the VIP segment of the population with our service. Our service has been widely accepted by customers across the world and we are growing pretty fast.
In India, pricing is very competitive. It starts with a minimum of Rs 80. Post-booking, the consumer needs to pay Rs 18 per kilometer and Rs 2 per minute. The minimum fare is Rs 200 and cancellations charge is just Rs 100. The cars we operate are premium ones such as Mercedes Benz, Honda Accord and Toyota Camry. In fact, we are providing a better quality service at cheaper rates.
Do you own and operate fleets? Or do you partner with fleet owners to provide the service?
We are basically a platform player and provide only the technology platform for consumers to book and hire cars. We follow a single strategy in all the markets. We have partnered with various fleet owners and offline car-hire services in the city to provide the service. Uber has a good number of fleet operators in its kitty and this number is growing fast.
A user can request a ride any time using our iOS and Android apps, as well as from our mobile site. For the same, he/she has to select his/her pickup location on a map (on the iOS and Android apps), and type their address on m.uber.com. The user can also text an address and city to a pre-assigned number, and we will dispatch the nearest driver to pick him/her up. The user receives a text with an estimated arrival time, and one more when the car finally arrives. After the ride, Uber automatically charges the credit card the user has on file.
Being a leading global player, do you think your entry to India will pose a threat to other players in the country? Will you look to consolidate?
I am not in a position to talk about this. Every company has its own space as this market is huge and offers massive opportunities.
We have been growing organically well since we started operations in 2009. As of now, we are looking to a provide quality and reliable service to our customers in Bangalore. We will continue to do so. We have no plans to acquire small companies in the sector and grow inorganically.
(Edited by Joby Puthuparampil Johnson)