Last year in July, Uber had pumped a staggering $1 billion in India to fuel its expansion. Now according to a report in the ET, Uber is planning to invest $500 million more into India operations for further expansion and, of course, to fuel its fierce fight of market share with Indian taxi aggregator Ola.
The plan is to spend each dollar more efficiently than our competitors, and invest in building a team, technology solutions that are India-focussed, and quality,
said a senior executive at Uber adding that the company also has funds remaining from its previous $1 billion which have not been utilised.
The company plans to invest this amount over a period of next three months. In addition to the expansion, the investment will also be used for forging more partnerships with the government and other businesses, marketing purposes, and for strengthening the driver base of the ride sharing app.
The new investment comes at a crucial time for Uber which counts India as its most important market outside the US along with China and is focussed on making amendments to its rather bumpy beginning in the country.
After having a slow and controversial start, Uber has rapidly built its business in the Indian subcontinent through planned expansion as well as other initiatives.
Over the past one year,in addition to an expansion of its core taxi hiring business to new cities, Uber has brought new services such as UberPool and UberAssist to cater to the different demands of Indian consumers.
The company has committed a $50 million investment over 5 years to house its largest global office, outside the US in Hyderabad. It is also planning to open its first engineering office in India at Bengaluru to customize local solutions for the Indian transportation market.
On top of these, Uber has launched a plethora of initiatives to boost entrepreneurship in India through partnerships with state governments and mentoring new startups through UberExchange.
As a result of these multidimensional efforts which have also contributed to enhancing its overall brand image in the country, Uber has now really begun to threaten the monopoly of Ola despite its presence in mere 26 cities as opposed to Ola’s presence in over 200 cities.
This is mainly because a majority of the revenues of both companies come from few major cities such as Bengaluru, Hyderabad, Chennai, Delhi-National Capital Region, and Kolkata. And Uber has grown immensely popular in these cities eating a significant share of Ola’s business.
And it is not just the battle of business for these companies in India. Both the companies are now also engaged in a court battle with Uber accusing Ola of disrupting its business by fake accounts and has demanded a compensation of nearly 50 crores for the same.