Airport cab business must be slipping away from Ola and Uber
I had a Monday morning flight at 6:45 AM. I have been using Uber for most of my ride to airports for some time now. But the night prior to my morning flight, I was skeptical of relying on Uber. Finding morning airport rides on Ola or Uber is increasingly becoming harder. Either you wait for 15-20 mins for a nearby ride to complete or switch frantically between Ola and Uber apps to see which app could actually get you a cab. So far, I had couple of close calls but had still not missed a flight. And since I am not the one to give up, I decided to give the ride hailing services one more try.
Morning of Monday, I wake up at 4 AM. Drive to airport usually takes an hour from home. I was planning to leave from home at 4:45 AM. I start booking cab from 4:20 AM. No Uber Go. No Uber Premier. No Uber XL. Requests time out. I try Ola. No Mini. No Prime. Nothing. It is already 4:45 AM. One more attempt with Ola app. Wait, I see Ola Bike! Something better than nothing! I book Ola Bike. The guy thankfully comes with a scooty and not a bike. I could fit my cabin luggages at the front. Ride starts. He even offers to drive 35km and drop me at the airport! I set the destination to a busy 4-way intersection which is 5 km from home. Roads are empty but I can now see some auto rickshaws as I reach the intersection. Auto drivers are willing to drop me to the airport. But it is December. We are in the global warming. But highway winds are still chilly. I refuse the offer. I open Ola app again. I find a Ola Prime which is 2 mins away but at 2X cost. I go ahead. Thankfully the cab arrives. I reach airport. Display was flashing ‘Final Boarding’ in red and I board the flight just in time. Definitely a close call.
This is not a lonely story. Conversation with fellow travellers and office colleagues tell you similar story. Users, especially business travellers, are no more trusting Uber/Ola for airport rides. Some are relying on their trusted and known drivers, some are dialling up Meru and Mega cabs. Makemytrip/Goibibo have now actually started offering airport cab at reasonable rates (one driver told me that they have tied up with Mega Cabs in the backend). Personally, I have now moved to using local cab services and definitely plan to try out Makemytrip/Goibibo cab service as well.
Is airport pick-up and drop-off sizeable business? According to Uber filing, Uber generated 15% of its ride which either started or ended at the airport. A June 2019 report in Economic Times, Ola and Uber are doing a total of 3.5 million to 3.6 million rides a day in India. This means that about 500,000 rides per day start or end at airport. If cab operators take Rs. 100 cut (Uber actually takes a 30% cut), this translates into Rs. 5 Cr a day or Rs. 1825 Cr annual revenue for Ola/Uber. If you assume, 60% market share for ride hailing cabs, this is easily a Rs. 3000 Cr. business. This by no means is a small business. It can also be a profitable business especially when your customers are premium customers who are ready to fork out a little extra for a reliable and convenient service. Even the airport cab drivers are a different lot. They are different from casual Uber/Ola drivers, are far more professional drivers preferring to drive on empty high way roads away from the hustle and bustle of cities rather than short casual city trips.
Uber and Ola have to watch out. Unless they can get their act together, onboard more drivers or treat the airport rides differently by ensuring more reliability, this business will be shipping away from them. Network effects are great but network spiral down can be quick and hard to contain as well. As a consumer, I would still be rooting for Uber/Ola to get their act together for you indeed have pampered me with all your convenience and low rates!