Updated: Reliance Jio Cabs Coming Soon To Disrupt App-Based Cab Rental Market; 600 Cabs Already Bought!
Update [27/02/2017]: Reliance Jio Spokesperson, in a Tweet, has stated that this report is completely wrong and company has denied any such moves. We are still trying to find more on this, however, as of now Reliance has denied this development
Last year, we had reported that Reliance is contemplating to kickstart app-based cab services, similar to what Uber and Ola are providing right now. If we believe some insider reports emerging, then their plan is now in its final stage, and the services would be rolled out by the end of 2017.
An insider from Reliance informed: “The plan is to launch after April but it might take up to six months more depending how the commercial rollout pans out,”
Uber and Ola, both should worry now, because Reliance has one clear cut objective behind this mission: Complete dominance of app-based taxi market in India.
Can Reliance Jio Cabs Disrupt The Market?
As per some reliance sources, Reliance has named this service as Reliance Jio Cabs, and initially they had planned to launch the service in the month of April. However, due to Jio’s telecom services’ commercial launch, they have postponed the launch to year end.
Around 600 cabs have already been bought from Mahindra and Hyundai, and the business model is being worked out. Some earlier reports indicated that Reliance is in talks with some leading financial institutions for arranging quick auto loans to drivers who wish to become part of their network.
Consulting firm E&Y are right now devising their business model, pricing strategy and go-to-market strategy, and a formal announcement would be made soon.
As per sources, consultants at E&Y have been instructed by Reliance Industries Chairman, Mukesh Ambani with one single line memo: “go all out to get market share,”, which means complete dominance of the market.
Operations Will Start from South India?
The report also mentions the fact that Reliance Jio Cabs would start their operations from South India, mainly from Bengaluru and Chennai, and then gradually will roll out their services in Delhi and Mumbai. This is indeed interesting, because a) Reliance is headquartered in Mumbai b) Right now, Delhi-NCR accounts for maximum app-based taxi bookings across India.
The source said: “South India is a better market for to start. Slowly it will move on to north,”
Besides, plans are also on to roll out their services in Tier 2 and 3 cities simultaneously, a strategy which Jio adapted for their telecom services as well. It seems that Reliance is in no mood to give their competitors any chance to recover.
We had earlier reported that Jio cabs would be powered with free Jio 4G services, and the payment mechanism would be aided by Jio Money.
App-based taxi market is is expected to touch $20 billion by 2020, and as per a market study by RedSeer, close to 500 million taxi rides were booked via apps in 2016, compared to 130 million rides in 2015.
Reliance is now all set to enter and dominate this burgeoning market, and consumers are expecting another round of freebies and discounts.
We will keep you updated on this news..