Don't laugh off the Finance Minister's Ola, Uber comment
When Union Finance Minister Nirmala Sitharaman attributed the decline in auto sales to the increased adoption of ride-hailing apps such as Ola and Uber, social media hollered in disbelief. However, case studies from around the world show that not only is this scenario possible, but is already happening in many developed countries. The world is moving from vehicle ownerships to what is known as mobility as a service (MaaS). Ride-hailing applications such as Ola and Uber are just one segment of this booming industry.
Take the case of car subscription services.
On Thursday, auto major Mahindra & Mahindra announced its own subscription services, where a car can be hired on rental basis. The pioneer in the subscription model in India is the self-driving platform Zoomcar. Customers can rent a car for a month, and then list it back on the platform on days they don’t use it, to get their rental charges reduced. The subscription services, however, are now a passé in the global MaaS market, which has moved towards other concepts. Ride-sharing applications such as Lyft and Sidecar, which provide carpooling services, are on a surge in developed markets to such an extent that they are being seen as competitors by traditional ride-hailing apps like Uber.
There are players that have gone further ahead in the space, such as the SoMo (stands for social mobility) platform launched by Here Mobility. It provides event-based mobility solutions, through a combination of several methods—ride-sharing, ride-hailing, and by identifying common friends going to the same event.
Globally, these technology-driven startups have disrupted traditional auto sales. What policymakers have failed to achieve with respect to public transport, the industry seems to be doing effortlessly. It’s not without hassles, and the primary ones are regulatory hurdles. If policymakers are serious about cushioning the impact of the slide in the auto sector, they must focus on reinventing their policies to look at ‘Mobility as a Service’.