Zoomcar takes on Uber, Ola with its cab rental service
What's the story
Zoomcar, one of the leading names in the self-drive car-sharing space, is finally venturing into the chauffeur-driven cab rental business, Reuters reports. The company, which has been focusing on self-drive rentals, is expanding its horizons with this new service, which will be launched in Bengaluru. It will offer rentals from two hours to more than a month to customers who prefer cars with drivers over self-drive.
Financial hurdles
New venture amid financial challenges
The launch of the cab rental service comes at a time when Zoomcar is struggling with financial troubles. The company recently fired co-founder Greg Moran from his CEO position, after a stint that took the firm public in the US. Now, it is raising funds to pay off debt and invest in this new venture, as confirmed by current CEO Hiroshi Nishijima, during a recent interview with Reuters.
Market competition
Plans to compete with Uber and others
Zoomcar's foray into the chauffeur-driven cab rental segment will pit it against established players like Ola, Uber, and Rapido. However, the company plans to set itself apart by letting customers select specific cars instead of a category of vehicles. It will aggregate cars and drivers for this service, a cost-effective strategy usually employed to cut down costs related to asset acquisition and staff employment.
Information
Pricing strategy and fundraising efforts
Zoomcar doesn't plan to offer discounts or incentives to compete in the cab rental market. Instead, it aims to price its service attractively. The company is currently raising funds with the aim of using the proceeds to repay debt, cover monthly losses, and invest in growth.