There has been speculations swirling around for some time now that ride-hailing company Uber may be looking to scale down its Indian operations, which the company had denied vehemently.
A recent development only adds grist to the mill that India may no longer be hot destination for company.
Ahead of Uber filing for IPO in May in the US, a report suggests that its business operations in India have gone for an overhaul. The operations of Uber India will now report to Pierre-Dimitri Gore-Coty, who as vice president currently heads the company’s Europe, Middle East and Africa business from Amsterdam.
Currently, the India business reports to Asia Pacific region headquartered in Singapore. Amit Jain, who was instrumental in growing the company’s ride business India and headed Uber India’s operations before moving up to become the head of the Asia Pacific business, has decided to call it quits.
A spokesperson of Uber is reported to have said that Pierre will work with APAC teams to unlock opportunity markets such as Japan and South Korea, and continue the company strong momentum in markets such as India and Australia.
The move of bringing together the two regions under a single leadership is primarily seen as a move to foster more synergies in the ridership business. For instance, emerging markets like India and sub-Saharan Africa which include Egypt, Nigeria, Kenya and Tanzania have a lot of similarities in the business and products which are being developed in one of the countries are being launched in the others.
The ride for Uber in India has not been easy with controversy dogging it at every step. And the developments over the last few months suggest that homegrown Ola might be pulling away in India, even as Uber struggles with internal issues and realigning its focus.
Moreover, there is a common thread running through these two rival companies. Softbank is heavily backing Uber and it happens to be the largest shareholder in Ola. It is widely seen as a force to avoid a clash between the two companies it has invested in.
The investor made its stand clear in January 2018 when Softbank board director Rajeev Mishra said the firm wanted Uber to focus on its core markets: the US, Europe, Latin America, and Australia.
While Uber is unlikely to pack up and leave India just as it did in China and Russia, analysts have been waiting to see some kind of tacit understanding between Ola and Uber to reduce the cash burn in the Indian market.
Significantly, Uber had been ramping up its technology team in India. The company is also increasing its R&D headcount from 500 to 1000 in a year and will work on requirements not only for India but also for emerging markets. It is also exploring high capacity 12 or 30-40 seater vehicles, which will have both fixed as well as variable routes depending on demand supported by technology.
(The development was reported by Business Standard)