Uber has quietly closed down the service of uberAUTO in New Delhi, about seven months after its launch.
The service had been launched in April to take on its biggest rival Ola as well as a host of other smaller service providers.
“At Uber, we continuously experiment with products to ensure that we can provide the most efficient, affordable, and reliable ride to everyone everywhere. We are temporarily removing this product to solve specific problems that need to be resolved to help it scale," the company said in a statement.
The service had been removed from Uber’s app around a fortnight back, although the company has not been specific in detailing the problems that the service encountered.
Unlike Ola which has its auto-rickshaw service in six cities with expansion plans to include three more soon, uberAUTO was solely limited to Delhi for its seven-month run, despite reporting good feedback from customers and drivers.
It is worth remembering that with uberAUTO, Uber had deviated from its global business model for the first time, to accept cash as a mode of payment.
India is Uber’s second largest market globally, behind the US and despite many hiccups with accusations of lack of adequate preemptive safety measures in its Indian run, the Silicon Valley startup has constantly reiterated its commitment and bullishness to the country’s market.
This exit, temporary or permanent, has for the time being left Ola to battle it out with Jugnoo which recently raised $80 million in funding. Ola currently boasts of 65,000 to 70,000 auto-rickshaws being registered with it across the country.
Of course, questions are now being raised about the viability of auto-rickshaw booking services’ model with offers like the Delhi government’s very own Pooch-O failing to make an imprint in the market and the likes MGaadi and AutoWale, not creating significant splashes as well. Undoubtedly, the margins too are far lower than the ultra successful cab model, which makes emulation and similar scaling up much tougher.
BW Reporters
Simar Singh is one of the youngest members of the BW team. A fresh graduate from IIMC, she also holds a degree in political science from LSR. She enjoys covering power, startups, lifestyle and a little bit of tech.
