App-connected transportation service Uber has just launched its lower-cost UberX tier in Bangalore, Delhi and Hyderabad. This immediately increases its market manifold, and takes on popular taxi services like Meru, Ola and TaxiForSure.
Uber already caught everyone’s attention in India when it introduced upscale cars like the Audi and Jaguar into the market for on-demand rides in August 2013. Now smaller cars like the Swift and Etios will join Uber’s roster of vehicles. “uberX is UberBLACK’s little brother. He’s a little less buttoned-up but just as fast and super affordable. He’s the rebel who wears sneakers with a suit,” says an uber blog post, announcing the launch of uberX in Bangalore.
As usual, UberX is priced at roughly the cost of an ordinary radio taxi in its target cities, or slightly less.
Other taxi operators here will be worried that a global company, which was valued at US$18 billion when it raised a whopping US$2.1 billion in funding recently, has entered their space. At the same time, there is room for growth in the affordable section of this market. Despite the launch of a number of new services in the past couple of years, it’s still hard to book a taxi in Bangalore during peak hours.
Of late, the service quality too has taken a hit as the operators are in a rush to scale up. I was recently left high and dry after booking a taxi to take my mother to the airport. We had to scramble at the last minute to make alternative arrangements because the promised taxi did not show up. Many others have had similar experiences in recent months. They will be hoping that Competition from Uber will bring both more availability and service quality to radio taxis in Bangalore.