Rented cars are gradually becoming a regular sight on Indian roads. However, as Zoomcar founder and CEO Greg Moran puts it, these are very early days in India yet for self-drive car rentals.

Still, the company is aiming to reach 20 million unique self-drive bookings over the next two years. Zoomcar plans to achieve this by adding to its vehicle fleet. “Right now, we are very supply constrained. To reach the mentioned number, we have to grow,” Moran said.

Fleet expansion

This year, the company aims to have a fleet of 20,000 cars and have two to three times that number by next year. With 50,000-60,000 cars, the 20-million number can be easily achieved, he added. Zoomcar’s subscription service, Zap, will be a key aspect in boosting the company’s fleet. The service lets subscribers rent out their vehicle on days they aren’t using them, thus offsetting some of the monthly rental cost. “If the normal subscription is, say, ₹25,000, in actuality it ends up being ₹7,000 or ₹8,000,” said Moran.

Electric vehicles

Further, with Zoomcar adding electric cars to its fleet, the sharing model in the company’s subscription service can help bring down costs for the cars, as electric vehicles are more expensive than internal combustion engine-powered ones. “Without a shared subscription service, it becomes hard to justify the economics of electric vehicles today,” Moran said. “But, with shared subscription and electric vehicle prices gradually coming down every year for the next ten years, it’s going to get better,” he said.

In December last year, Zoomcar collaborated with Tata Motors to deploy electric Tata Tigor vehicles in Pune. “I think Tata, more than some of the other players, understands the ecosystem approach to electric. They have different entities like Tata Power that are aligned towards that kind of product push,” said Moran. This helps improve the user experience and bring down costs, he added.

While Moran hoped for more infrastructure to support electric vehicles in India, he said that the shared subscription model could help deal with charging worries. According to Moran, under this model, cars could run for about 30-40 km a day on average and about 70 km at most. With the car getting charged at the subscriber’s residence overnight, it can easily cover that range. With respect to regulations governing car rentals, Moran said that Zoomcar seeks clarity from the authorities. It has been reported that the Karnataka government refused to renew the licenses of Zoomcar vehicles citing the absence of meters in them.

“We have always contested that self-drive has some differences to taxis. It seems reasonable to think that you should have slightly different regulations for the service,” he said. Currently, the Karnataka High Court has allowed Zoomcar vehicles to continue to ply while the matter is being decided.

Zoomcar currently has a 70 per cent market share in the car rental business, according to Moran. He said that growing to 10 times or 20 times from the current numbers is achievable for the company, and the only hold-back is on the supply side.

Published on February 6, 2019