Uber’s aggressive expansion strategy in Asia has taken a major leap today. According to an official statement which we received from Uber India head Amit Jain, Uber would invest a staggering $1 Billion into its India business to fuel rapid expansion across the subcontinent.
India has been an important market for Uber, ever since it started its operations here in October 2013. Starting from s singe city (Bangalore), Uber now has presence in over 18 cities across India. It recently expanded operations in 7 new Indian cities together, making it Uber biggest-ever simultaneous expansion till date.
The current round of investment into Indian operations holds all the more significance, considering Ola’s expected $500 Million fresh round, which could close by the end of this year.
Uber went in for a similar cash-boost for its China operations this year, which was uncovered from a leaked e-mail which CEO Travais Kalanick sent to this employees in China. Uber has plans to spend as much as $1 Billion in China to counter Didi Kuaidi, which has seen a significant decline in services due to Uber’s superior and more timely offerings. Didi Kuaidi in turn raised a staggering $2 Billion to counter Uber’s operations, along with several other measures.
This recent $1 Billion cash infusion into India, will come after Uber’s announcement of certain India-friendly measures in the past.
The company, which earlier rolled out cash-based payments on a pilot basis in Hyderabad, recently expanded the same into more Indian cities, which is sure to give a boost to its user-base in the non-digital section of India.
Previously, the company had partnered with Auto-Rickshaw drivers in Delhi, bringing the iconic three-wheeler on its app for booking. The company had also set aside a special $50 Million fund to set up its Indian HQ in Hyderabad, thus re-affirming the fact that India continues to be the most important market for the U.S.-based company.
We have asked Uber India and US for a statement, and will update the story as soon as we hear something from them.
We have received an official statement from Uber’s India president Amit Jain, who apart from confirming the $1 Billion investment plan, has also detailed out the entire India strategy :
Uber has grown exponentially in India, a global priority market for us, which has also quickly become the largest market geographically for Uber outside the US. We are continuing to see robust 40% growth MoM and with more investment in product, hiring, and payment solutions, we expect to grow at an even faster rate. With this investment and the strong rate of growth we are seeing, we expect to hit over 1 million trips per day in the next six to nine months.
We are extremely bullish on the Indian market and see tremendous potential here. India is one of Uber’s big priorities, along with China and uberPOOL. All three have the ability to significantly improve people’s lives, as well as build a great business. This is why Uber is committing an additional $1 billion to India in the next nine months so we can expand and improve our operations, expand into newer cities, develop new products as well as payment solutions, and establish a great support network. With this investment and the strong rate of growth we are seeing, we expect to hit over 1 million trips per day in the next six to nine months.
An interesting point made by Amit, is the fact that the company is looking to make “new payment solutions” as well, hinting at either an altogether different payment system suited more to Indian users, or probably an acquisition of a payment solutions provider. These are just speculations though.
Another interesting aspect which Uber mailed me via a statement, is the fact that the top 5 cities for the U.S. based cab-hailing app in India already contribute over 80% of its total trips.