Uber Technologies plans on expanding its fleet size

India: Uber Technologies India is planning a significant expansion of its car fleet, by buying around 200,000 passenger cars over the span of next two years and rent them out to drivers who are willing to join the company. The purchase is likely to be the biggest ever by a single buyer in India.

The purchasing of the vehicles would be done through the company’s leasing unit, Xchange Leasing. Automotive OEM’s such as Tata and Maruti Suzuki are expected to benefit the most from this expansion plan, as Uber already has pacts with these two companies for vehicle purchase, driver skilling program and finance solutions. The company is aiming to sign around a million drivers over the next two years.

“We aim to empower a million driver-partners by 2018 under our UberSHAAN initiative and expect that potentially one out of five new drivers would be on the platform through our leasing programme” said Raj Beri, head of leasing at Uber India.

India has emerged as the second biggest market for the company, however, the company faces a tough competition from domestic player, Ola which is also expanding in the Indian market.

According to a recent report published by TechSci Research, “India Radio Taxi Services Market Forecast & Opportunities, 2020”, radio taxi services market in India has been exhibiting strong growth over the last few years within tier-I and tier-II cities witnessing vast improvements in their transportation systems. With changing traveler’s lifestyle and preferences, an increasing number of people in the country, especially corporates, prefer well-maintained, on-time taxi services, which is majorly addressed by organized radio taxi service providers in the country.

As per TechSci Research, the move made by Uber to expand its fleet size is anticipated to increase the company’s market penetration in the country, where it already holds a relatively strong position. Moreover, by this expansion plan, the company is likely to tap a large chunk of customer base in the country’s radio taxi market.