The growing need for personal mobility in the wake of rising urbanization and fall in car ownership is driving the demand for the ride sharing market. The ride sharing service provides convenient access to personal mobility whenever and wherever needed by using the transportation network system.
“COVID-19 Impact on Ride Sharing Market is projected to grow at a Y-O-Y of 55.6% during the forecast period, to reach $117.34 billion by 2021 from $75.39 billion in 2020.
Some of the key players in the ride sharing market are Uber (US), Lyft (US), DiDi (China), Grab (Singapore), Gett (Israel), Ola (India), BlaBlaCar (France), Lime (US), and Herts (US).
Earlier, traditional taxicabs dominated the ride sharing market. However, in recent years, this scenario has changed with the disruption caused by the app- and web-based taxi aggregators such as Uber, Lyft, and DiDi. Mobility service providers and few Tier I companies in the automotive industry are working on autonomous vehicles. It is likely to alter the ride sharing business landscape in the coming future. In autonomous vehicles, the service provider would have 100% ownership, and the revenue would be directly generated by the service provider and not the driver. Hence, the profit-making capacity of companies would improve. Therefore, OEMs and ride sharing service providers would be entering this market with their full capacity, thereby changing the business landscape. This is likely to be important from multiple standpoints as one of the biggest pain points of ride sharing companies is increasing profitability and reducing acquisition cost per new customer. The introduction of fully autonomous cars to ride sharing fleets would drastically help reduce overhead costs and increase profitability in the long term.
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The station-based mobility segment is expected to grow at the fastest CAGR in the ride sharing market by service type. The vehicles offered today for station-based services are scooters, bikes, bicycles, small electric cars, and other personal transit, which offer low prices and on-demand availability. It is necessary to follow social distancing to control the spread of coronavirus, which can be established through station-based mobility. At the same time, the precautionary measures that require the sanitization of vehicles would create a hurdle for the growth of these services, as it would add capex and infrastructure, which will result in increased operational costs.
The payment services market is growing at the fastest Y-O-Y growth during the forecast period for the ride sharing market by data services. International expansion of ride sharing service providers and payments in foreign currencies is likely to boost the growth of the payment services segment. The demand for payment services will grow much faster than expected because of the post-COVID-19 effect. In the post-pandemic period, users would prefer app-based payments instead of cash to minimize the chances of infection.
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In the Asia Pacific, developing countries are expected to experience significant growth, primarily in urban transportation. The high population growth rate in the region and increasing urbanization have intensified the need for transportation. Most of the countries in the region are shifting their focus on smart personal mobility to reduce travel time and congestion. Such markets can offer attractive opportunities for ride sharing services as they have tremendous scope for ride sharing. The key players are tapping this opportunity by offering extra incentives to electric vehicle ride sharing drivers. For instance, Uber has started paying extra dollars per trip to drivers for driving electric cars. With the increasing number of electric vehicles, the number of riders keen to choose electric vehicles for ride sharing would also increase, thereby boosting the ride sharing market. Moreover, China has started to recover from the COVID-19 pandemic faster than any other country.
Key Questions addressed by the report:
- What is the impact of COVID-19 on the ride sharing market and its services?
- What would be the impact of COVID-19 on ride sharing industry by 2021?
- What are the opportunities for ride sharing service providers?
- Which ride sharing services would get impacted? (Positive/Negative)
- Who are the major competitors, and what are their growth strategies?