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Uber eyes slashing private car ownership in Dhaka

One of its top executives tells the FE


Mehdi Musharraf Bhuiyan | Published: December 07, 2017 10:38:04 | Updated: December 08, 2017 13:37:48


According to BRTA data, on average 58 new private cars are pressed into service every day in Dhaka now. - Focus Bangla photo

Uber is looking to solve Dhaka's public commuting dilemma by minimising the culture of private car ownership and complementing other modes of public transports, one of the top executives at the global ride sharing giant said recently.

"Our goal is to minimise the private car ownership," Pradeep Parameswaran, head of Uber's Central Operation for South Asia, told the FE in an interview.

"We believe that people will be less interested in owning a car if they know that they can get an Uber within three or four minutes, and such services are also affordable," he said.

"Uber's aim here is not to compete with the CNGs or buses," said Parameswaran, who was in the capital recently to celebrate Uber's one year of operations in Dhaka. "Rather, our goal is to be complementary to other modes of public transports."

Uber, which has become synonymous with ride sharing in many cities across the globe, launched its service in Dhaka in November last year.

However, soon after, the Bangladesh Road Transport Authority (BRTA) issued a notice saying that the ride-hailing service was in violation of the country's motor vehicles regulations.

Despite the ruling, Uber and a number of similar other ride sharing services have gained popularity in the capital over the last one year. Consequently, the government has also reportedly started developing a 'Ride Sharing Guideline'.

"Our experience with Bangladesh so far, has been very positive -- whether it is about the regulatory authorities or driver partners or riders. The guideline that has been drafted is also quite progressive," Parameswaran said.

"The growing presence of a number of ride sharing entities indicates that the market is quite attractive. Collectively, it makes the market grow faster and also pushed the regulator to move faster," he added.

As per the company's own figure, an Uber was requested 1.5 million times in Dhaka in the month of November this year alone while more than 0.2 million people took an Uber trip in the capital.

Despite such growing popularity, it has often been pointed out that the fare of Uber in Dhaka is relatively higher compared to some other cities in the region, including Kolkata.

When asked about the reason for this higher fare, the Uber executive blamed it on the relatively higher prices of four wheelers in Bangladesh. "When it comes to ride sharing, the cost of service is determined primarily by the cost of a car."

He added: "If the cars are cheaper, the cost of ride sharing service also remains cheaper. But, if the cars are expensive, the cost also becomes relatively high."

Globally, Uber is apparently going through some rough patches as the Silicon Valley-based company's net loss has reportedly increased to US$1.46 billion in the third quarter from US$1.06 billion in the previous quarter.

The Uber executive, however, pointed out that the ride sharing as an industry is still at a nascent stage and Uber as a company is still at investment phase in many of its markets. "Globally, this industry is still at an infant stage. At such a phase, the companies need a lot of support and investment."

Although the company was making profits in the cities where it has been operating for last seven or eight years, he said, but it was still at the investment stage in many other locations where its presence is relatively new.

"Secondly, part of the loss is also attributed to the investments that we are making in other segments of our business," he added.

"However, our new CEO has been very optimistic about going for IPO in 2019. So, obviously, as we move towards that, there are expectations that the losses will come down," he said.

Recently, it has also been revealed that Uber was hit by a massive data breach back in October 2016 when the data of its 57 million passengers were stolen by hackers.

Asked about this issue, Parameswaran replied: "What happened should not have happened.
"We live in a dangerous world when it comes to cyber security-- and it is a concern for all digital companies today."

The Uber top official also informed that his company was planning to introduce its uberPOOL feature in Dhaka next year. This feature will allow pick up and drop off multiple riders going in the same direction.

"At the same time, we also have plans to take our service to other cities beyond Dhaka," he added.

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