If diversification is a good strategy, then it seems Reliance Industries has taken it too seriously.
As per reports, $89 billion worth Reliance Industries, which is India’s most profitable company, may soon venture into online taxi booking niche, which is currently dominated by Uber and Ola in India. As per various sources, Reliance has contacted several tax owners in this regard, and their services can be launched by March, 2016.
In fact, rumors are abuzz that Reliance has already bought 2000 Toyota Etios cars in Kolkata alone, which would be used for offering their new cab services.
Considering that Reliance owns Jio, which provides 4G network; and also deals with petroleum and gas products; these cabs from Reliance are rumored to be equipped with 4G connection and will be powered by their own CNG fuel.
Biggest Advantage for Reliance: CNG
It can turn out to be a unique combination of advantages, as Reliance is planning to own their own cars, get their own CNG and include 4G services as a bonus.
CNG fitted taxis incur an average cost of Rs 4/km; which would be even lowered as Reliance will provide these taxis with their own CNG. Another interesting development is the fact that Reliance will open their own exclusive CNG filling stations for their taxis, which will reduce the time taken to refill CNG in taxis.
Since last few months, Reliance had been re-opening their outlets, which can turn out to be a game changer.
Taxi aggregators such as Uber and Ola may actually find it tough to beat such a lethal combination. Reliance can, infact, introduce a whole new level of pricing, which can completely change the equations for this niche market. Just like telecom, we may witness some major shake-up in this sector now.
Reliance has refused to confirm this story as of now.
Dominance of Uber, Ola Under Threat?
In the last few months, we have observed that both Ola and Uber have gradually decreased their incentives for drivers, and this has infact caused much outrage all over the nation.
In October 2015, drivers in Bangalore vandalized Uber’s office as they were protesting that their incentives have been substantially lowered. Uber drivers in Hyderabad also protested against lowering of incentives and they did not hesitate to showcase their anger.
The same thing happened with Ola as well: In Bangalore, drivers alleged that their incentives have been drastically reduced from Rs 150 per trip to meager Rs 25. Last year, Ola drivers in Hyderabad stormed inside their Kundapur office and heavy protests ensued.
As a behemoth called Reliance enters the taxi booking niche, Uber and Ola can now feel greater heat as they will definitely need to remodel their incentives schemes, bring down the price for customer, and match Reliance all at the same time.
Meanwhile, for the end-users, it may signal another wave of heavy discounts and free rides.
Do you think that Reliance will be able to match the efficiency and technology of Uber/Ola in online taxi niche? Or will it turn out to be another half-hearted attempt at diversification by Reliance?
Do share your opinions by commenting right here!
Image: Shutterstock.com
Koi date bta sakta ki reliance cab Delhi me kab launch hoga
Reliance is a game changer and they might also change the way things are going. But it will be Uber and Ola experience which may keep them ahead. Just providing 4G in the cab won’t make a difference. Let’s see what else Reliance comes up with.
Reliance must come in chennai… i support our ambani forever with his products. Becoz reliance grw means our economy growing. And need auto attachment too with reliance.. plan it well without loss for drivers and your end. As usaly people in need to use so minimum commision reliance wil hit jackpot.. drivers first feel free to drive for that no need of incentive for that less commision u get thats enough.
Come soon reliance taxi service I also Viber driver,I accept reliance taxis.it comes banglore as brightness.
Reliance Come on and show up ur Power in tous cab bussiness too WELCOME Mumbai ALL THE BEST. I want business with you.
i am waiting u reliance for last one year, plz come in hyderabad.
What about partners those are attached their cars with Ola & uber. Will they also attach their cars with reliance as well ? Plz rpy.
Most welcome reliance in Bangalore
Guys jus think who had ever showen us the world of started from CDMA that’s the bigger thing that time and now all are the sons of reliance … Back of eve1 … Reliance come on show e1 that u r back with the power which u always hv and hats of to the AMBANI SIR who showed the way of cell phone world love u reliance
Nice to hear but Reliance s started a cab but one doubt cab driver’s r attaching his own car or reliance giving a car (bozs) I’m a cab driver I bought a new etios car so i have to pay emi in 4 years pls don’t punch stomach
Waiting for u peoples when it will launch in Hyderabad we r waiting for relance
No need of CAB services in best prices like 4 Rs/km. Please don’t increase pollution and traffic in the cities. There is metro services to take care of it. We all need good hospitals and education at low cost. We hearty welcomes you. Please come and serve the people with low cost of charges.
When will Reliance cabs open in Bangalore..?
Sorry to bump in, but where is the CNG with Reliance? All the production (continuously falling) from KG basin is decided by Govt. of India to be sold to Fertilizer and Power sector. Please check the facts before writing such articles.
Thanks
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This is one of the most interesting “What Ifs” that I have seen lately. Sure.. Reliance has CNG, 4G as well as the financial muscle to build up an ecosystem that will rival Uber / Ola. However, in India, businesses are equally influenced by “Log (people) kya kahenge” mentality. Reliance has a huge responsibility to shoulder.
Nonetheless, what the writer has proposed isn’t entirely out of the realm of possibilities that the 4G ecosystem can aide & certainly boost.
Reliance is a purely “For-Profit” organization & will operate as such. However, one thing that it is not.. is “Experimental” & certainly not is “Radical Minded” which startups usually are.
There is a TON of money to be made by exorbitantly charging desperate commuters, while spending very little on the costs or expenses.
This is funny. Its like saying that I have wheat and sugar and I will make the best biscuits in the world?
Earlier also Reliance has failed in fuel distribution business and innumerable closed petrol bunks are tall witnesses of the same. Even while Shell could survive as a retail player as well in the market, Reliance miserable failed.
It will have to be seen and they will have to work smartly to win confidence of consumers!
Vikash – Agreed… whether they will be successful or not, only time will tell. However, you cannot deny the fact that they have the means and the financial muscle to be successful in this area. They are also at an advantage compared to others because they have their own CNG and can offer value added services in cabs (4G services, multimedia content etc). And biggest thing of all is that they have huge political backing…nothing can beat that…
Agree….they do have the financial muscle. While, they did fail in Petrol Pumps, but its also a worth to recollect how they were able to change the telecom landscape with 500 INR handset. Similarly, they have huge land banks in Gujarat, HP, MAH, etc. which can be used for their CNG pumps which can reduce their operational expense. And of-course, 4G can be a game changer. With various in-cab voucher options (may be for Reliance Mart, Fresh, Electronics, etc) they have huge ecosystem to bank on.
Again, only time can tell whether they will be successful or not — but — a big player entering niche area will for sure ruffle the feathers.
They didn’t shut the fuel retail business because of losses as you think but because of government regulation on pricing of fuels then. Now the government deregulated the diesel prices in last 3 years they are entering now. As simple as that.
reliance is big big company and he always success in every kind of business
Arun, bhai sahi bolay aap is k saath political party hai lakin, jab yea party nahi honge to is ka haa is k close pumps ke traha he honga,
Q k Reliance ko petrol or diesel BJP k power me hone se sasta milra is k jane k bad kiya honga????????