(Entertainment-NewsWire.com, April 12, 2019 ) The growing need for personal mobility in the wake of rising urbanization and fall in car ownership is driving the demand for the Ride Sharing Market. The ride-sharing service provides convenient access to personal mobility whenever and wherever needed by using the transportation network system.
The ride-sharing market is projected to grow at a CAGR of 19.87% during the forecast period, to reach USD 218.0 billion by 2025 from USD 61.3 billion in 2018.
Earlier, traditional taxicabs have dominated the ridesharing market. However, in recent years, this scenario has changed with the disruption caused by the app- and web-based taxi aggregators such as Uber, Lyft, and DiDi. Mobility service providers and few tier-1 companies in the automotive industry are working on autonomous vehicles. It is likely to alter the ride-sharing business landscape in the coming future. In autonomous vehicles, the service provider would have 100% ownership, and the revenue would be directly generated by the service provider and not the driver. Hence, the profit-making capacity of companies would improve. Therefore, OEMs and ride-sharing service providers would be entering this market with their full capacity, thereby changing the business landscape. This is likely to be important from multiple standpoints as one of the biggest pain points of the ride-sharing companies is increasing profitability and reducing acquisition cost per new customer. The introduction of fully autonomous cars to ridesharing fleets would drastically help to reduce overhead costs and increase profitability in the long term.
The station-based mobility segment is expected to grow at the fastest CAGR in the ride-sharing market by service type. Station-based mobility provides stacks and racks of vehicles at closely spaced intervals throughout a city; it is convenient and of low cost. Users get the benefits of an automobile without the associated high costs and parking requirements. Governments across the world incentivize Station-based mobility, and dedicated tracks are laid in various countries for the station to station mobility. Station-based mobility options are also important in smart city scenarios as small vehicles placed at strategic locations would help in solving the first-mile last-mile problem. The service providers can leverage this opportunity by providing more vehicles for station-based mobility in the form of bicycles, scooters, and even four-wheelers. This service can be provided with electric vehicles such as e-scooters and small electric cars and hence contributing to pollution control.
The electric vehicle market is growing at the fastest CAGR during the forecast period, for the ride-sharing market, by vehicle propulsion. This growth is attributed to the existing lower penetration of such vehicles in the ride-sharing fleets, favorable government policies, improving charging infrastructure, and growing awareness about CO2 emission. IC engine vehicles have the largest share in the ride-sharing market as the ride-sharing landscape is dominated by these vehicle type as they are cost-effective to purchase, operate, and maintain. At the initial stage, ride sharing with electric vehicles would be costly as it is difficult to operate and maintain. However, in the future, the awareness among people to use electric vehicles is expected to grow which would ultimately enhance the market for ride-sharing service by electric vehicles. The service providers can leverage this opportunity by providing a suitable sustainability model of ride sharing with electric vehicles which could attract drivers and people to opt for the same. This can also be an opportunity for tier-1 manufacturers to develop electric vehicle system and use cases that can be relevant for the ride-sharing scenario.
In some countries the user penetration is low but the smartphone penetration is increasing, and they have a large number of foreign visitors. Such markets can offer attractive opportunities for ride-sharing services as they have tremendous scope for ride sharing. The key players are tapping this opportunity by offering extra incentives to electric vehicle ride-sharing drivers. For instance, Uber has started paying extra dollars per trip to drivers for driving electric cars. With the increasing number of electric vehicles, the number of riders keen to choose electric vehicles for ride-sharing would also increase, thereby boosting the ridesharing market.