On-demand transportation aggregators Uber and Ola have signed MoUs with the Rajasthan government for new initiatives in the State.
While Uber is launching peer-to-peer ride sharing in the State, Ola will work with the Rajasthan government to introduce some of its products like Ola Auto and Ola Share. While Uber says its initiative will provide “entrepreneurial opportunities” for 35,000 people, its competitor Ola expects to provide skill development for 50,000 people in the State in the next five years.
Ola already has operations in Rajasthan with a presence in Jaipur, Udaipur, Kota, Ajmer, and Jodhpur, while Uber offers its services in Jaipur.
“We will further improve access to mobility in cities across the state by bringing on-board innovative transportation use cases like Ola Auto, Ola Share and many more to complement the existing urban transportation system in Rajasthan,” said Pranay Jivrajka, Chief Operating Officer at Ola.
Uber has signed the MoU a week after it entered into a similar agreement with the Punjab government. Under Uber’s peer-to-peer model, anyone with a valid driving licence can use his or her private vehicle to give a ride to Uber users. Under its regular model, Uber’s drivers need a commercial licence. The charges in the peer-to-peer ride sharing model will be around the same as that of the commercial vehicles working with Uber.
The launch of the pilot programme will take place in two weeks in Punjab and within a month in Rajasthan. Just like the regular model, peer-to-peer will also operate as a point-to-point service within the city. The driver verification will also follow the same procedures as when Uber on-boards a taxi driver.
Targeting those professionals and housewives who would like to make some extra income, this business model will supplement the demand for convenient transportation, Uber claims. “It makes perfect sense for everyone. For riders, there are more cars available, for drivers unparalleled flexibility and asset utilisation and for cities, accessibility like never before,” said an Uber spokesperson.
The launch in Rajasthan will be followed in other States as well.
Both Uber and Ola have big ambitions for India. For Uber, India is its second largest market after USA, with operations in 22 cities. Ola has a presence in over 100 cities. However, supply of taxis is a constraint. Estimates of number of taxis in India vary from a million to about 1.5 million. As Uber and Ola have grown beyond the metros, which have a majority of India’s taxi fleet, it is this supply constraint that will inhibit their growth. Uber has had to deal with driver trouble with protests breaking out in Mumbai, Hyderabad, and Bengaluru. However, they will need to do much more than just sign MoUs to immediately improve the supply of reliable drivers on their platforms. Their success will depend on it.