Corporate failure of taxi for sure

Abstract

Indian taxi industry comprises of two sectors, organized and un-organized sector. The unorganized sector consists of local taxi players in a city whereas the latter consists of taxi-aggregators and owners. major player in the organized-owner segment was Meru Cabs, which started its operations in Mumbai in 2007. Since it was ownership-based radio cab operator, it operated with a huge fleet of vehicles which mainly consisted of Mahindra Logan.1 In 2009, Uber Cabs was launched in the US and was received positively by drivers and customers alike. It was a taxi-aggregator company, i.e., it didn’t own the taxies, but provided a platform that connected operators and the customers. Thus, Uber earned margin through every successful match between demand for taxi by a customer and supply by an operator. Shortly after, Ola started its operations in in Mumbai, India under the name of ANI Technologies Private Limited. This ushered the Indian taxi-cab industry into the era of growing organized taxi-aggregator sector. So, as Ola and TFS were building their businesses and expanding to various cities, Uber decided to launch in India in Bangalore in the year 2013. Since it was Uber’s 20th country and 5th year of operations, they already had an experience of making it into the market and were supported by a bunch of investors. At the time, Uber’s valuation was around $3.7B. Although it received a positive response from the customers of the industry, it was relatively small compared to Ola and TFS.