Days after selling its Southeast Asian business to regional rival Grab, Uber may now follow the same recourse for its India business as it looks to trim down its mounting losses. Reliable sources have revealed to top media publications that Uber is currently holding talks with its Indian competitor Ola for selling off its India business. The deal is evidently facilitated by SoftBank, which is the common and largest investor in both the ride-hailing companies.
The discussions are still in the initial stage and may take months for both companies to agree on terms and conditions, startup website Inc42 claimed after quoting one of the sources.
However, these unconfirmed reports are in complete contrast to Uber’s CEO Dara Khosrowshahi’s long-term plan for India. Khosrowshahi, who was recently in India to attend a business summit, touted India amongst the core markets for the ride-hailing giant and reiterated that the company will continue to invest heavily in the Indian market in a bid to stay ahead of its rival Ola.
While industry experts may pay serious heed to Khosrowshahi’s long-term plan for the Indian market but sources claim that SoftBank’s pressure on Uber to exit all its loss making markets is simply too overbearing.
It is now well known that the Japanese investment giant is trying to push Uber to strong foothold ahead of its much anticipated IPO early next year. This would entail in ride hailing giant making an unceremonious exit from all the loss-making markets (mainly Asian markets) and divert all its focus on core markets. These core markets include the U.S, Europe, Latin America and Australia.
Currently India is the last remaining jewel in Uber’s Asian crown following the company’s latest exit from the Southeast Asian market and also last year’s exit from the Chinese market. If Uber does bid adieu to India then the company’s once ambitious dream to rule the highly lucrative Asian market would go sour.
Uber’s inability to cope with intense competition posed by the regional rivals like Didi Chuxing and Grab has certainly proved to be detrimental. Now only time will say whether India’s Ola will join this list and will have a last laugh over a company that prides itself for being the world’s most valued startup.