Ola expands low-cost Micro to non-metros; arch rival Uber cuts fares
Intensifying competition in India’s taxi aggregation space, Ola on Tuesday announced expansion of its low-cost ‘Micro’ service to non-metros like Ajmer, Udaipur and Nagpur, while rival Uber slashed fares in these cities.
“Ola Micro has expanded to 14 new cities. In total, Micro is now present in 27 cities in the country. The base fare in these cities is as low as Rs 30 followed by about Rs 6 per km,” Ola Chief Marketing Officer and Head of Categories Raghuvesh Sarup said. Ola Micro is now available in Nashik, Surat, Vadodara, Ajmer, Visakhapatnam, Thiruvananthapuram, Jodhpur, Mangaluru, Kochi, Mysore, Indore, Bhopal, Udaipur and Nagpur, he added.
Interestingly, its US-based rival Uber has slashed fares by up to 22 per cent in 10 non-metros, which also include some of the cities where Ola has now added its Micro offering.
“These cities are experiencing rapid economic growth and hold tremendous potential to grow as Metros of tomorrow. Understanding the unique needs of customers in these cities, we are confident of fuelling the continued growth of these ambitious Tier II cities,” he said.
Sarup said Micro alone, in its first 3 weeks since launch, crossed the daily bookings that Ola as a platform did in 3 years and is estimated to be well over 50 per cent the size of competition in such a short span of time. He had earlier said Micro may soon overtake rival Uber in terms of number of rides. Earlier today, Uber announced that it has slashed fares of its uberGO by up to 22 per cent in 10 non-metro cities, including Pune and Ahmedabad.
While fares have been slashed by 9 per cent in cities like Indore and Nagpur, the same has been cut by 22 per cent in Jodhpur and Udaipur for its affordable service, uberGO, the company said in a blog post.
Uber will now charge a base fare of Rs 25 instead of Rs 40 in Udaipur and Jodhpur. Also, the per kilometer charge has been reduced to Rs 7 from Rs 8. The fare cut would bring the cost down to Rs 5 per km in cities like Vizag, Nagpur, Indore and Ahmedabad. The other cities where tariff has been reduced include Pune, Ajmer, Mangaluru and Thiruvananthapuram.
“We are decreasing uberGO prices by up to 22 per cent making our service even more affordable for you to get where you need to go. But it’s also important to note that with increased demand drivers get busier as well,” it added.
More demand increases driver efficiency on the road, resulting in more trips per hour, and less idle time while driving on Uber, it said. “With even more affordable fares, we believe Uber can be a viable alternative to people driving their own cars with all the hassle and cost that parking brings,” it said.
In February, the US-based firm had slashed its fares by up to 25 per cent in Chennai and Kolkata. Uber has presence in over 400 cities in 70 countries. In India, it has services in over 25 cities, the highest compared to any other country outside the US.