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As Uber wades through legal hurdles and faces drivers’ protest in the UK, its Indian rival, Ola, is all set to foray into the market.
Six months after making its international debut in the Australian market, ride-hailing app Ola announced plans to enter the UK. Having obtained licences to operate in South Wales and Greater Manchester, Ola will launch operations in South Wales next month, the company said in a statement. Ola is inviting PHVs (private hire vehicles) and metered taxi drivers in Cardiff, Newport and Vale of Glamorgan to learn more about driving and registering with Ola at low introductory commission rates.
Consumer-friendly
The company said, it is the only ride-hailing app in the UK that offers passengers the option of PHVs and black cabs through one consumer-friendly platform, which will see additional transportation options incorporated for greater passenger choice.
The launch will see it take on rival Uber. The transport for London (TfL) ruled last September that Uber was not “fit and proper” to hold a PHV operator license. It has been awarded a 15-month probationary licence after it convinced the court that it had made the changes to ensure full compliance to UK regulations.
Ola’s attempt to build a global brand by entering markets like Australia and the UK where Uber is not pursuing market share very aggressively, is being viewed by experts as a diversification strategy and a way to increase its valuation.
Rajeev Banduni, co-founder and CEO, GrowthEnabler Global, said it is easier for Ola to expand in non-American markets where Uber does not dominate. “UK is a good choice, as it’s a very taxi-friendly country, where black cabs are popular. Second, the inflow of tourists to the UK is high especially from India and the Middle East. Therefore, all of Ola’s Indian customers who had to use Uber in international markets, will now be able to use Ola services.”
“Ola is leveraging its technology and operational cost efficiencies to serve a much larger customer base with its entry into UK and Australia,” pointed out Anil Kumar, CEO of RedSeer Consulting.
However, K Vaitheeswaran founder of India’s first e-commerce firm, Indiaplaza.com and author of ‘Failing to Succeed’ is of the view that Ola needs to execute much better in India before they go global. “Ola is going global to increase its valuation and diversify in order to derisk. While Ola claims to have a higher market share than Uber with a presence in over 100 cities, what needs to be examined is Ola’s market share in the markets where both of them operate,” he said.
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