Zoomcar, the popular self-drive car-sharing platform is gearing up to launch its chauffeur-driven cab rental service in Bengaluru, marking a significant step towards expanding its footprint in India’s competitive transportation market. The company is now aiming at catering the growing demand for chauffeur-driven services alongside its existing self-drive options.
Entering the cab rental market
This move surfaced months after Zoomcar parted ways with its co-founder Greg Moran, who had served as the CEO for over a decade. Under Moran’s leadership, the company further went public in the U.S. but faced financial challenges, leading to his departure.
Now, the company has been planning plans for tapping into the lucrative market for cab rentals, which has been dominated by major players like Ola and Uber.
Zoomcar's new chauffeur-driven service will offer rentals for durations ranging from just two hours to over a month. The company’s focus is on meeting the rising demand for cars with drivers, a shift from its traditional self-drive model.
As per Zoomcar’s CEO Hiroshi Nishijima, the market for chauffeur-driven cars in India is significantly larger than that for self-drive rentals.
A new business model to compete with industry giants
While Zoomcar may face stiff competition from established ride-hailing giants like Ola and Uber, the company is confident that its model of offering specific cars instead of vehicle categories will appeal to consumers. Customers will be able to select the exact car they want from Zoomcar’s app, making it a more tailored experience.
To minimize costs and maximize efficiency, Zoomcar plans to aggregate cars and drivers for its rental service, following a model that reduces the need for extensive assets and staffing. The company has stated that it will not rely on heavy discounts or incentives to attract customers, choosing instead to offer competitive pricing on its services.
Zoomcar’s plans for growth amid financial challenges
Zoomcar has recently faced financial challenges, including a funding crunch and high marketing costs. Earlier this year, the company exited international markets to focus on India. In November, Zoomcar expressed doubts about its ability to continue operating amidst ongoing losses and the need to raise funds for debt repayment and operational expenses.
Despite these challenges, Zoomcar is currently raising funds and plans to use the proceeds to repay its debts, cover monthly losses, and invest in further growth. The company hopes its new cab rental service will help boost its revenue and improve its financial standing.
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