On his maiden visit to India, Uber’s new Chief Executive Officer, Dara Khosrowshahi, affirmed that the global ride-hailing major sees the country as an “incredibly important and core market” and continues to be on an “investment mode,” despite operational losses in the market.
His remarks are significant as it shows that Uber is unlikely to change its investment strategy to shift focus away from India post the SoftBank’s 15 per cent stake buy in the cab aggregator last month.
When asked if SoftBank wants Uber to focus only on profitable markets, Khosrowshahi told a media roundtable in the capital that the company’s strategy is decided by its board.
“While SoftBank may have an opinion, their’s is not the only opinion in the room. And it is my belief that we as a company need to have a balanced profile in terms of growth and investment,” he said.
He felt that it is in Uber’s interests to stay committed to markets such as India and Latin America, which are large and presented long-term opportunity for growth. Khosrowshahi also said Uber will “aggressively invest” in South-East Asia in terms of marketing and subsidies, despite the company losing money in the market.
Miles to go
He said Uber is investing in India because “we believe in it. We believe in the long-term viability of the Indian market.”
Khosrowshahi, an Iranian American, became the CEO of Uber, the world’s most valuable start-up, in August 2017, succeeding founder Travis Kalanick.
Khoshrowshahi said there is much room to grow with Uber still accounting for less than 1 per cent of the miles driven in the world.
“We are now an alternative to taxis. What we want is to become an alternative to car ownership,” he said.
Currently, India accounts for over 10 per cent of Uber’s global trips and this will only go “higher and higher” as more investments are made in the market, he said. Indian operations are not profitable as yet, he added. While refraining from disclosing the level of investments made so far in India, Khoshrowshahi said “it’s a lot.”
He also said that Uber sees its driver-partner universe, which is at about 3 lakh strong now in India, growing 5-10x in the next three years. “We are on a good road there.”
Asked to spell out the business plan for expansion to more cities (Uber currently has a presence in 29 Indian cities), Khoshrowshahi said that from a population standpoint, the coverage as of now is good.
“We are not scaling up immediately. If your question is ‘Will we be in more cities in India three years from now’, the answer is yes. Our coverage in terms of cities in India is not too broad now, but we are at the right pace.”
One of the real mistakes companies make early on is trying to expand before they perfect the product, he added.