Blame it on the country’s massive population or the fact that car ownership for most Indians is a matter of personal pride, but urban mobility in India is a problem that start-ups as well as industry veterans have been trying to solve for a while now.
Auto Futures spoke to Ridecell’s Senior Director of Corporate Marketing, Diptii Tiiku, who gave us a glimpse of why ride-sharing is the perfect solution to combat congestion in India.
“India is one of the most densely populated countries in the world, with a population that has nearly doubled since 1980. Add to that an underdeveloped public transportation system and you have a perfect recipe for massive congestion and pollution. Ride-sharing and car-sharing have the potential to gradually eliminate private car ownership and help India out of that conundrum. But the ride-sharing model needs to be adapted to that particular market,” says Tiiku
“Culturally, ride-sharing is a familiar concept in India that existed on an ad-hoc basis before the term was coined or the cell phone even existed, but the rise of cell phones has created an organised market place with great financial potential.
“We can anticipate the rise of three forms of ride-sharing in India: one will be the Uber/Ola model of corporatised large companies; the second level will be made of providers that fulfil the needs of business travellers or offer trips for commuting to work or school; and the third one will be very much like the Via or Chariot shuttle systems.”
She says that, unlike in the US where there is an abundance of underused shuttles, India is lacking in the number of shuttles to fulfil routes as communities have grown faster than transportation systems and the local governments ́ability to meet the needs.
Ridecell helps companies build and operate profitable shared mobility businesses. From onboarding new customers to reservations, payments, fleet management, and even comprehensive analytics, the company’s intelligent infrastructure helps automate key aspects of running a shared mobility operation.
Speaking about what Ridecell has been doing in India, Tiiku says: “Ridecell has been actively engaging with entrepreneurs who want to take on the second type of ride-sharing: creating large pools of cars for multiple drivers to use and fulfil the supply gap to corporations for commuters or business travellers getting to and from the airport.
“The Ubers and Olas of the world are fulfilling the need for an on-demand experience. They are focused on optimising the time rather than the rider experience. The second type of ride-sharing can differentiate by focusing on the rider experience. They can charge a small premium because they are more reliable. Uber and Ola don’t have the time to audit each of their driver. Theirs is a mass market where available drivers are connected to available riders.
“But with the second type of service, you have an offering targeted to the needs of the user, whether a business traveller or a school commuter, and the ability to decide on the type of vehicle, such as an electric vehicle. You can also optimise the route for people and recharge vehicles at specific times and locations to maximise the number of routes per day.”
She adds: “We are engaging with businesses that want to innovate using electric vehicles, alternative fueling systems and who also care to offer a more engaging consumer experience, with hotels, carbon footprint reduction, etc.
“In parallel to our business goals, equally important to us is the tech hub we have built in India. We are recruiting the best and brightest tech minds to help us lead the new mobility technology space. We are continuously growing our team there and have doubled in size since the beginning of 2019.”
Bumps in the Road Ahead
According to Tiiku, one of the greatest challenges to the expansion of ride-sharing services in India are permits. She says: “New governmental regulations still need to be implemented in that space pertaining to the security and safety of passengers and even drivers in certain instances. This is not unique to India, but to any country that has low police per capita.
“Another challenge will be solving the issue of maintenance and wear-and-tear with an asset that is used 18-20 hours a day by multiple drivers. The vehicles currently used were not built for that purpose, but for private ownership, with aesthetics in mind vs. heavy usage.”
Despite the many challenges, Tiiku has a highly optimistic outlook of the ride-sharing space in India, and especially so for the electric ride-sharing space in particular.
“Following India’s official order to taxi operators and ridesharing providers to electrify at least 40 percent of their fleet by 2026 in exchange for subsidies, you can expect to see a lot more shared electric vehicles in the streets as well as charging stations. Unlike in American cities where distances are great and population densities are low, Indian cities are densely populated while distances are not that great. Take Mumbai for example, a 400 km² city for 20 million people or the Delhi region, 1,500 km² for 12 million people, and compare it to L.A ́s 1, 300 km² for a mere four million people.
“Smaller coverage areas, densely populated are the perfect breeding ground for the expansion of electric shared vehicles. This shift towards EV should also feed into the need to reduce the cost of operations and cost of running as alternative fuels (electric, natural gas) have a lower cost of running and a higher cost of vehicle acquisition for consumers, which works really well for the people putting up the capitals,” notes Tiiku.
She tells us that Ridecell offers a unique suite of products adapted to local Indian markets.
“Through our experience and partnerships in India, we have developed the ability to answer the unique challenges inherent to that space, such as managing drivers ́income levels or safety and security risks that are unique to this market. Because India’s ride-sharing challenges are unique, so are our solutions. For example, we had to dive a little deeper and innovate on ways to make free-floating work and avoid deadhead miles.”
She concludes: “Another big mobility opportunity lies in pushing operators towards B cities and not just A cities, which are often the focus. We are working with investors to help them see the value beyond the prime, most obvious markets, like Delhi, Mumbai and Bangalore, and consider rather Pune, Indore or Chandigarh.
“These cities and industrial towns are in dire need of better mobility solutions. They are as dense as their larger urban counterparts, they have the same urgent transportation needs, and capital available for individual car ownership is even lesser.”