Even as auto makers are voicing concerns over possibility of the Ubers and the Olas eating into their business, India Inc has strongly come out supporting this new disruptive business model, hailing these online taxi apps' ability to utilise assets to the fullest. "My view is that it is a great business model. I think it's truly innovative. There is a new type of industry that is going to come up which is going to squeeze off (the traditional ones)", N Chandrasekaran, who heads the country's largest software firm TCS, said at an event last week in Mumbai.
Pharma entrepreneur turned billionaire investor Ajay Piramal has hailed Uber's ability to utilise an asset to the fullest as its biggest strength. Citing the economic benefit of using such taxi hailing apps, he said running costs can come down by as much as 95 per cent if he opts for the services of Uber or Ola. "I think it's really utilising the unutilised capacity in the system. So, in some ways, you are making the whole world much more productive", Piramal said, adding this model is a win-win for all stakeholders.
Customers get unparallel service at lower costs, the driver gets paid more than what he would otherwise have if he was driving a taxi and the system benefits by utilisation of an asset to the fullest, he added. The support to Uber from India Inc comes days after auto major Mahindra & Mahindra chairman Anand Mahindra expressed fears of the model publicly, saying it could affect sales for the auto industry.
"The age of access being offered by taxi hailing apps like Uber and Ola is the biggest potential threat to the auto industry. Since these app operators have made transpiration a commodity, auto sales could be hit and volumes get impacted", Mahindra had said earlier this month in Pune. "A lot of youngsters who can own vehicles today don't want to own one today; now they need only access to menas of transportation", he said.
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