The ride-hailing market size was $50.4 billion in 2018, and it is expected to reach $120.2 billion by 2024, progressing at a CAGR of 13.0% during 2019–2024.
Asia-Pacific (APAC) generated the highest revenue in the past due to the high popularity of such services in China. In 2018, China accounted for an over 70.0% share in the APAC market, and it dominates the global market as well. The major player in this country is Beijing Xiaoju Technology Co. Ltd. (Didi Chuxing), which takes over 90% of all bookings in China.
The increasing deployment of electric vehicles (EVs) in ride-hailing services is a prominent market trend. Governments across the world are introducing regulations and policies to encourage the adoption of these vehicles in the fleets of service providers. Automakers are also focusing on the introduction of EV fleets for ride-hailing services. For example, in 2019, Hyundai Motor Company announced its plan to deploy a range of EVs in Ola Cabs in India by 2021.
The rising government support for the adoption of shared mobility is one of the major growth drivers for the ride-hailing market. For instance, in November 2018, the Mayor of London announced the construction of public parking spaces to facilitate the parking of public automobiles, with an intent to reduce the vehicle ownership rate.
Growth opportunities for the ride-hailing industry players are expanding due the hefty investments being made by eminent venture capitalists, automotive technology companies, and automakers themselves. For instance, in April 2019, Toyota Motor Corp. (Toyota), SoftBank Vision Fund (SVF), and DENSO Corporation announced their plan to invest $1 billion in Advanced Technologies Group (Uber ATG) of Uber Technologies Inc. Toyota and DENSO together invested $667 million, whereas SVF made an investment of $333 million, thereby increasing the worth of Uber ATG to $7.25 billion.
During 2014–2018, the economy category accounted for the largest market share within the vehicle type segment. This was because the number of cars operating under this category is more than those in the executive and luxury categories. A large number of users opt for ride-hailing services for traveling short-to-medium distances, so they do not prefer to invest much and choose economy cars.
The daily/weekly category, under the commuting pattern segment of the ride-hailing market, will advance at the highest CAGR during 2019–2024. This can be credited to the numerous tie-ups of ride-hailing service providers with business firms to provide shared mobility to the employees of the latter.
The personal category, within the end user segment, accounted for the larger market share in the past, as these services are majorly availed of for personal errands. Personal usage generally includes commuting to the workplace, grocery shopping, and traveling to specific locations, such as airports and railway stations.
The APAC region generated the highest revenue in the market for ride-hailing services in 2018 due to the rising government concerns regarding environmental pollution. Moreover, the surging Demand for alternative mobility options to reduce road congestion during the peak hours and increasing penetration of the internet have fueled the demand for these services in the region.
In the coming years, the Rest of the World (RoW) will display the fastest growth due to the escalating need to develop a mobility solution to mitigate environmental degradation and ensure travel convenience. Moreover, the high population density and urbanization rate of Brazil have led to a rise in the traffic congestion, which supports the ride-hailing market growth in the country.
The global ride-hailing market was consolidated in nature, characterized by the presence of established players such as Beijing Xiaoju Technology Co. Ltd. (Didi Chuxing), and Uber Technologies Inc. Besides, Grab Holdings Inc., ANI Technologies Pvt. Ltd. (Ola), Yandex.Taxi B.V., Gett Inc., FREE NOW, inDriver, RideCell Inc., Bolt Technology OÜ, VOXTUR SAS, and Addison Lee Ltd. are the other players operating in the market.
In recent years, several companies launched and expanded their services in the ride-hailing market. For instance, in July 2019, Uber Technologies Inc. launched Uber Comfort, a new ride tier, which would offer customers to access quick ride, control vehicle's air conditioning, and high rated drivers at a premium price. The cost of Uber Comfort would be 20–40% more than UberX ride. The service was launched in 44 cities across three U.S. states, namely, New Jersey, Connecticut, and Rhode Island.
Furthermore, in June 2019, DiDi Mobility Japan Corp., a joint venture by SoftBank Corp. and Beijing Xiaoju Technology Co. Ltd. (Didi Chuxing), announced the launch of its ride-hailing services in Hokkaido, Japan, which includes the capital city of Sapporo. This would follow a further expansion of services to Tokyo, Kyoto, Osaka, and Hyogo, and other areas, by the end of the year. In Hokkaido, the company would provide services in areas, such as Sapporo, Hakodate, and Furano, by collaborating with leading taxi companies.
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