Only a minority driving the strike: Amit Jain
Govt has not differentiated between MNCs and MNCs with Indian founders, says the Uber India head
At a time when San Franciscobased Uber has been in news for all the wrong reasons, including video footage showing founder Travis Kalanick screaming at a driver and his subsequent apology, the India head of the ride-hailing company Amit Jain engaged with Business Standard in an open-house chat on Thursday. While drivers’ strike in Delhi-National Capital Region (NCR) and Bengaluru may have been on top of Jain’s mind, he ended up taking a range of questions, from investments to profitability, rivals to government policies and much more.
Jain, president Uber India and South Asia, said the drivers’ strike was driven by a small number of individuals. The violence and intimidation spearheaded by those individuals forced people to stay offline, he said. Pointing out that the company had support from the courts, he said hundreds of drivers came to the Uber office, saying it should not happen and that it was adversely impacting their livelihood. “Many of those individuals are not even on our platform.”
Was competition behind the agitation then? “I don’t know what I don’t know. I can’t say what I don’t know,” Jain replied, keeping things open-ended. Replying to another question on rivals such as Ola, Jain referred to them as “multinationals with Indian founders”. Did the government discriminate between an Uber and an Ola? “There’s no disparity…. In India, no government has shown any differentiation between multinationals and “multinationals with Indian founders” (laughs). All leading internet-led start-ups are funded by marquee foreign investors, even though the company founders may be Indians. Ola belongs to the same category.
On drivers’ allegations that their incentives are declining, which was the primary reason for the agitation in Delhi-NCR and Bengaluru, Jain said, “It’s important to be clear that individual driver earnings vary widely and individual driver behaviour - where, when and how much or little drivers choose to drive — also vary widely, making averages difficult. It is not, nor was it designed to be, a one-size-fits-all approach.’’
The future of the business depends on making driving with Uber the most attractive choice, Jain pointed out. “Currently, 80 per cent of drivers across India, who are online for more than six hours a day make between ~1,500 and ~2,500 a day, minus the Uber service fee.” He, however, added that “as a twosided market, we have reached a tipping point in India, where sustained high demand from riders and drivers allows us to begin reducing higher levels of incentives to operate more efficiently, and invest in India across driver partners, our products and programmes for the driver community across a longer term.”
On investments in India, Jain said the company was committed to this market. But he pointed out that as a market matures, the level of investment comes down. Uber has been in India for three-and-ahalf years, and is yet to start making money. “We would like to be profitable today, but every company must go through the investment phase,” according to Jain. He listed Australia and the UK among the profitable markets for Uber.
Cautious about giving out market share numbers versus main rival Ola, Uber would rather stick to rider percentage vis-à-vis total cars in a city. In Delhi-NCR, for instance, Uber’s share is less than one per cent of the total car rides, implying the vast growth potential.
At Uber, each day could bring a new incentive target to a driver, depending on the demand and supply. While there’s a view that that such a model could result in unrest among the driver partners over the number of trips that one must complete in a day or the number of hours one must be on the road to earn a certain incentive, Jain promises more consistency in future. That could mean a much lower incentives or near zero incentive for driver partners, as and when demand goes up significantly. He said it was tough to set a date for such a model.
Any mistake that Uber would like to set right in India or anything that the company could have done differently? After some thought, Jain said, communication about the entrepreneurship opportunity given to driver partners by Uber could have been done much better.