The shadow-boxing is over. The players have sussed each other out, swayed away occasionally, hugged and made up. But the bell has just been rung. The year 2017 should go down as the one when things got real in the global ride-hailing wars. Companies, both incumbent and global, have begun making decisive moves that could go a long way in deciding how transportation shapes up in the years to come.
As a start, imagine them as four distinct worlds with contrasting strategies in play.
A world where two ride-hailing companies battle it out for global domination, in completely different ways. A world where an investor sees an opportunity and goes for it because of an inherent belief that ride-hailing, like it or not, is here to stay. And there are millions of dollars to be made if you bet on the winning horse. Then, there’s technology; it has a more than important role to play, in order to sustain this disruption. There’s another world, where automobile manufacturers, long left out of this tech-driven transportation revolution, want to have their say. Not just through indirect means anymore, but make an early play for what threatens to come tomorrow—the autonomous or self-driving car, which is what they believe ride-hailing will eventually evolve into.
It will be fair to say that ride hailing is a global opportunity. With too many moving pieces. Till last year Uber was invincible. Today, chances are that not just Softbank, even Uber’s archrival, Didi Chuxing might pick up a stake in Uber. There’s just so much happening. So, we‘ve simplified it for you. Using four world maps, you should be up to speed on the cast of characters, alliances and rivalries. Let’s dive in.
Uber: A ship desperately in need of steadying
This year hasn’t been particularly great for the American ride-hailing company Uber. It has been virtually boxed into a corner thanks to management issues, scandals, litigation, and most recently, boardroom wrangles, culminating in its once-popular CEO Travis Kalanick stepping down from his role. But even as troubles continue to mount, Uber has maintained its dominant position in markets like North America (around 80% market share).
A good question to ask is, how long will it last? Especially considering how Lyft is benefitting from Uber’s fall by eating into its market share and in attracting investment from other Uber rivals like Didi Chuxing, and potentially SoftBank. According to a report in The Information citing a credit card analytics company, Lyft has been able to gain traction in cities like Portland (48% market share), Sacramento (44%), San Francisco (39%) and Los Angeles (33%) as of July 2017. Lyft, the report says, “has become a growing problem for Uber in some major cities, which could limit Uber’s ability to turn profitable.” This, the report adds, could emerge as a problem for Uber in terms of its overseas investments.
