Where is taxi aggregator business heading ?
Will it last long in India ?
Taxi Aggregator business is one industry that is dependend on manpower ( Drivers ) than anyone else. The business runs mostly on comission basis. However to start this business you will have to shell some finances to get that manpower. Repeated advertising, irrestable incentives and perks are taking a toll on the business in order to keep the clients (drivers) interested.
On a long run where is the taxi aggregator business heading ? The business models and governament regulations are keeping this business on a path of disaster. India is one country where lot of regulations are only on the books and hardly implimented specially the motor vehicles act. Some of the complications that the aggregator business might face is definelty from this motor Vehicle acts and business models.
While most countries like Australia have taken the road safety and driving fatigue seriously, the Indian motor vehicle act is yet to take a look at this. When this happens there will be a definete pressure on the taxi aggregators, who give incentives to these drivers who work extra hours with fatigue. If the laws are implimented rightly there will be a definite crunch of supply (cabs) and need for spilling out more finances increases more than ever to bring in more drivers. This would bring the already ailing industry run by incentives diffult to compete with the local vendors as the risk of investing more would not be viable.
The next thing on the crash course is the changing business models. With some operators introducing the leasing of cars ( Eg, Ola Lease ) owned by the company, this will make the personal cab owners more suspicious of the motives behind the move hence, affecting their loyalty to the company. The decision of bringing company owned cars against the private cab drivers might turn out to be the most dangerous move ever. This move has already raised suspision among the drivers.
There will be some thinking and hard decisions by the investors in the coming days with regards to the points mentioned above. Till these concerns are not addressed in the right way the path of the business is disastrous to both the drivers and investors.
