Uber chief executive Dara Khosrowshahi has said that Rapido has become the company’s biggest competitor in India, moving ahead of Ola, which he described as “kind of a distant third.”
“Ola used to be our main competition. We were always going head to head with Ola in terms of category position in the marketplace. I think [Bhavish Aggarwal] got somewhat distracted by other interesting areas for him. So I see now the tougher competition in India is Rapido,” Khosrowshahi said during an episode of Nikhil Kamath’s podcast People by WTF.
He added that India remains one of Uber’s most important markets, ranking as the company’s third-largest market in terms of mobility trips. “When we talk about the business in India… the competition that we talk about is really Rapido,” he said.
Explaining what sets Rapido apart, Khosrowshahi highlighted its subscription-based model for drivers. “I’m not on the ground, but I think Rapido built a really simple model which is basically the subscription model, you pay a certain amount, and for the rest of the day, you operate on what’s essentially your commission… the driver pay is higher than a player who, like us, who’s taking a commission on every trip. So I think that was a smart way for them to break into the marketplace,” he said.
Reports suggest that Rapido charges only 0 to 5 per cent commission per ride, compared with the 18 to 22 per cent charged by Uber and Ola. Media coverage has also indicated that as of April this year, Rapido held about 40 per cent of the ride-hailing market share across all vehicle categories.
Despite its rapid rise, Khosrowshahi pointed out that Rapido is not yet profitable. “Rapido is not making money. So the real test of the business isn’t how fast you can grow if you’re spending, it’s actually how fast you can grow while you’re profitable. And I think Rapido is a long way away from that. But they’ve been innovative, they’ve been scrappy, they’ve moved fast. They’re building their brand there in the local market, so we’ve got a lot of respect for them. And, you know, we intend to compete really hard with them.”
Rapido has reported a 46.3 per cent year-on-year growth, with revenue reaching Rs 648 crore in the fiscal year ending March 2024. The company also reduced its losses by 45 per cent to Rs 371 crore in the same period. Its FY25 financial results have not yet been announced.
The company has recently expanded into the food delivery market, taking on established players like Zomato and Swiggy. Reports suggest that Swiggy is considering selling its stake in the Prosus-backed company due to a potential conflict of interest.
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