Zoomcar looks to marketplace model to swing into high gear

Priyanka Pani Mumbai | Updated on January 09, 2018

Greg Moran, co-founder and CEO, Zoomcar

Will transition into asset-light model in six months

Self-drive car rental start-up Zoomcar says it will completely transition itself into a marketplace and asset-light model in the next six months with its Zoomcar Associate Programme (ZAP).

The Bengaluru-based start-up launched its marketplace model last April after it realised that owning a fleet incurred huge costs and that maintenance cost was impacting profits. Besides, co-founder Greg Moran told BusinessLine that ZAP helps in scaling up faster compared with owning a fleet.

“Currently, the ZAP model is about 20 per cent of the total business; in six months from now, it will be at over 90 per cent. The model is also more sustainable and profitable,” Moran said, adding that the plan is to have a fleet of 25,000 cars by 2019. The company is in talks with various State governments to solve the regulatory issues around having a commercial licence for a private car. At present, Zoomcar has about 2,600 cars (both own and associates’ ) on its platform

The company, which has about 600 users enrolled on ZAP so far, charges about 25 per cent commission from associates (car owners) and let the latter earn the rest. “It is a complete win-win for us and the associate. They can run the car for their private use and also put the same car on ZAP whenever they are not using it. They can earn some money on the car that is standing idle, and pay off their EMIs,” Moran said, adding that the car would be maintained by the associates.

Zoomcar, which is backed by auto major Ford, is also looking to go global by next year and plans to venture into markets similar to India in terms of demography and market potential. It is exploring opportunities in Africa and other Asian markets.

“We should be in 20-plus countries in 2-3 years. We are looking at a couple of places pretty aggressively. We will start with Asia and eventually get into Africa, which is a pretty uncharted market. From the tech point of view, not many strong companies have come out of Africa. The demographic is quite similar to India’s, and it presents a large opportunity,” he said.

“Last year, we were in about seven cities; now we are in about 24 cities and will go to 30 in the next six months. We have build and strengthened our technology and infrastructure that gives us lot of confidence to go global,” said Moran, an expat.

Electric cars

On his future plans, he said the company will launch self-driving electric cars on its platform and is in talks with Mahindra for the latter’s Reva model.

“In the next 18 months, we should expect a lot of action in the electric cars, with Mahindra having an edge in the segment. A lot of State governments, such as Karnataka, Maharastra and Delhi, have been putting all the infrastructure in place.”

Published on August 28, 2017

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