'India business is not about milestones’: Uber India boss Prabhjeet Singh on the ride-hailing giant's profitability push

Marking a decade of operations in India, Uber is strategically broadening its service spectrum across cars, autorickshaws, two-wheelers and buses, along with intercity travel alternatives. This multi-mode approach is helping it retain customers within the platform, while offering users services at different price points. Concurrently, says Prabhjeet Singh, President of Uber India and South Asia, the company is actively engaged in initiatives to enhance drivers’ earning opportunities in a fiercely competitive market like India. It involves an increased focus on CNG vehicles and transition to electric vehicles (EVs) that can help driver partners curtail operational costs. In an exclusive interview with Business Today’s Binu Paul, Singh says there is still a lot more to do in India and the company is here to stay. Edited excerpts:

Q: In the past 10 years, how has Uber India established its position, both in the local market and within Uber’s global operations?

A: We have seen India welcome us with open arms. We have built a very large business with a strong market leadership. We have done more than 3 billion trips to date here. Today, we have more than 800,000 active drivers, doing one to five trips each week. Our drivers have earned over `50,000 crore through the platform since 2013. Three million drivers have earned via the Uber app. We do much more than 500 million trips a year. And we are one of the fastest growing geographies for Uber at this scale.

We provide our services in 125 cities across the country. We provide services across a spectrum of two- and three-wheelers, cabs and buses. Globally, it is the third largest market on an absolute basis already, and growing rapidly. The India business has made massive strides towards being a very viable business, our economics have improved significantly. We feel very good about where we are headed.

Q: How significant has Uber’s recovery been from the impact of the pandemic, in terms of operations and market position?

A: The pandemic obviously impacted mobility in a big way. However, we have grown significantly since then. Today, we are bigger than what we were on volume and value terms [pre-Covid-19]. All the categories are larger than what they were, especially Uber Moto and Auto, which shows there is a fundamental shift in passenger and driver behaviour.

Q: How does Dara Khosrowshahi (CEO of Uber) perceive the potential in the Indian market, and how is his vision shaping the strategic direction of Uber in India?

A: Dara is a long-term thinker, and, thereby, he is able to see the potential of the Indian market. He knows we are here to win, and we can take long-term bets. What this translates into is the push he has made on innovation to serve the local requirement. Compared to 2017 and now, the India business is far more diversified today. In 2013, we started with only premium sedans. Today, we do more trips on two- and three-wheelers than on cars. We are introducing high-capacity vehicles (buses) in several cities. We see that [diversification] playing out as a part of his push to be more relevant to a larger consumer base. Our technology centre in Bengaluru is one of the largest globally, outside the US. We build full-stack tech solutions here for global operations. His view is that in the spirit of being disruptive, sometimes we antagonise local stakeholders like unions. He encourages local teams to find common ground with policymakers.

Q: In India’s cut-throat competitive market, how does Uber differentiate itself and stay ahead of the competition?

A: India is a large market; it has multiple ride-hailing players, so it will remain a competitive space. What matters is, are we doing the right thing for the consumers and drivers? For consumers, our focus is to be consistently reliable, affordable and safer. If we fail on either of these three, consumers will shift. Drivers have a choice. They can switch between multiple apps, or go off the app to travel operators, which means they will choose a platform that gives them the maximum earning opportunity, which also treats them with respect, and one that has their back when things go wrong. We just focus on these three things.

Q: Reliability and affordability are concerns for consumers. How are you addressing this?

A: There was a phase after the pandemic when cancellations spiked on the platform. The reliability promise took a hit. We really had to double down to ensure that this improves. Through a bunch of driver-obsessed changes and tech innovations, service quality has improved over the past 12 months. Compared to a year ago, cancellations are down 95 per cent, and completion rate from vehicles are more than 10 percentage points above. Today, more drivers are coming to the Uber platform than other ride-hailing platforms. Pre-Covid-19, our active driver base was about half a million, now we are at about 800,000 drivers (across all segments). Even in cars, we have more active cars on the platform than we ever had. Over the next two years, more than 150,000-200,000 new cars are going to enter [our platform], and replace the old ones. It will improve the physical experience of the customers.

We look at affordability from three dimensions. We are a two-sided marketplace, the marketplace will scale only if we offer fair earnings to the drivers, and reasonable prices for the passengers. When the cost of inputs for drivers goes up—like the cost of a vehicle which went up, cost of fuel increased by about 40 per cent post the pandemic and the oil crisis—we had to translate that into increased prices for passengers so that the drivers are compensated fairly. Often our pricing reflects the cost structure of the vehicle.

Second, we have diversified our portfolio recognising that consumers are price sensitive. The same customers use different products at different times. That is a superpower which we have as a platform, where customers are able to stay on the platform because we are able to offer them multiple use cases.

Third, our core technology is driving utilisation in a very material way. Because we build technologies for our global operations—which works in 60+ countries—we are able to find optimisations much faster. We also focus on the discipline of this cost structure. We have less than 250 people running the entire India business (except the global tech team), and that helps us keep the pricing low for the passengers.

Q: Could you outline the safety enhancements and measures that have been implemented?

A: We put safety front and centre in everything we do. For several years now, there has been a high bar on background checks, not just for car drivers, but also auto drivers. We have put in place a technology infrastructure that gives support like sharing trip details, ride check that tracks unexpected long stops, and 24x7 safety helpline, for the passengers and drivers during the trip and even after the trip.

In certain cities, law enforcement agencies have made their infra available; we have integrated our safety helpline with that. We anonymise all calls. We also provide comprehensive accident insurance for drivers and riders. We have taken more than 100,ooo drivers through in-person gender sensitisation training. Also introduced driver selfies to ensure the person driving the car is the same person who is registered. We are piloting multiple experiments globally such as audio recording with the permission of passengers and drivers; we will see if that product makes sense in India. We are also working on specific safety features for women drivers.

Q: How are you approaching profitability?

A: We have built an incredibly strong top line and scale, and are growing fast from there. On the bottom line, we have made some tremendous progress on profitability, which is allowing Dara and the global leadership to lean in even further on the India market. We run a very disciplined business. We have proven that we can actually run a very strong, economically viable business in a low-fare market like India, where there are multiple competitors. And we operate in a commercially-licenced market, which means there is a cost of supply that is higher than other markets.

I wouldn’t be able to give specifics [on revenue and profitability], but large parts of our portfolio are in a very good place in terms of continuously improving economics. And we feel good about making long-term investments on the back of that.

There is still more to do in India, because the total penetration of ride sharing is still very low here. That is why we need more product lines like buses, autos, cars and EVs that can meet the requirement of consumers. [The] India business is not about milestones. We are here for multiple decades to come. For now, we are just putting our heads down and focussing on innovation and execution. There is so much more to be done.

Q: What are the specific steps Uber India is taking to implement the electrification strategy?

A: Globally, we have committed to become emission free across our platform by 2040. India fits into that plan. However, the pace at which electrification will happen will be a function of how ready the ecosystem is, where multiple models have to be available, cost has to be reasonable, and the charging infra has to be readily available. We anticipate that India is seeing early momentum even though the tipping point is yet to come.

We are leaning in as a leading player to commit to launching Uber Green in three markets. We believe sustainability is a team game where everyone needs to play their part. Therefore, we are working with multiple players in the ecosystem to ensure access to vehicles, enable charging infrastructure, and unlock financing. We see our role as a catalyst in the full value chain.

Right now we have more than 6,000 EVs on the platform across vehicle segments. We have made an internal commitment that we want to have at least 25,000 electric cars on our platform by 2025, which will be a sizeable part of the cars fleet.

 

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