From the old Fast Track call taxi to the new Taxiforsure, the Indian roads are now flooded with taxi service providers. In Chennai where autos with meters were a distant dream until a year ago, the call taxi was one of the essential transport service provider in Chennai. Capitalising on this auto anarchy, FastTrack call taxi service was the biggest beneficiary. Set up in 2001, Fast Track dominated the market for more than a decade. It barely had any competition even when the service was not up to the mark at times. “There have been times, I had an appointment with my doctor but my taxi booking would get cancelled last minute,” said SitaVijayaraghavan, a home maker.
Chennai market still wide open...
While Chennaites were waiting for better times, New Travel Lines (India) Pvt Ltd, set up NTL Call Taxi in mid-2012. NTL advertised the brand heavily and became an instant success. Despite this, the Chennai market was still wide open with just two big players and a few small players.
This is not just the case in Chennai but entire India. According to India Radio Taxi Services Market Forecast & Opportunities 2017, the radio taxi services market in India has huge untapped opportunities. There are very few players in the organised radio taxi services market. The market demand was not met due to unavailability of required number of cabs.
Sensing a good business opportunity, a new breed of service providers have emerged all over India. With funding from angel investors and leveraging modern technology, these new taxi aggregators have become a major threat to existing radio taxi providers. Start-up companies like Taxiforsure, Uber, Ola cabs and Meru cabs have set up shop in several metros and large cities in the country.
According to a recent report by TechSci Research, the radio taxi services market revenues are forecast to grow at a CAGR of 25 per cent during 2014-19. This is on account of rapid urbanisation, increasing demand from corporate sector, growing per capita income coupled with various benefits offered by Radio Taxis such as enhanced passenger comfort and security as well as GPS/GPRS and internet connectivity.
Advent of Uber...
One of the first such providers to come to Chennai was Uber, a San Fransico-based company which has developed its own smartphone application and connects car owners with potential clients. This swanky app lets the customer book a cab even 10 minutes before travel and lets the passenger track the driver. Uber revolutionised the taxi market and is the inspiration behind many such ventures set up in India.
Indian companies like Taxiforsure, Ola cabs and Meru cabs followed Uber and this marked the witnessing price war. To beat competition, these taxi providers started offerring heavy discounts and promotional offers. With all these providers using phone and internet based applications, they offer considerable discounts for first time users to garner sign-ups. Even existing players like NTL have now started bringing online apps with promotional offers.
Understanding that cheap mode of transportation is the way to go in India, Uber introduced UberX, a cheaper vision of their existing facility, UberBlack. UberX sends smaller cars and is 40 per cent cheaper than UberBlack. Ola has launched Olamini, a similar offering for the lower end of the market.
Despite this plethora of providers, the overall opportunity in the market is huge. According to Ramaswamy Sankar, Branch Head of Taxiforsure Chennai, there is no big competitor yet when you compare the opportunity in the market. “The taxi market is a multi-billion dollar industry in India. The way I see is to use technology to transform the lives of thousands of taxi drivers by increasing their income and social status,” he added.
With all this soaring competition and so many options to choose from, the consumer becoming the king. The change is welcome to the Chennai commuter taken for a ride by auto rickshaw terrorism.