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As the number of competitors in the wrinkle-hailing industry dwindles, geographic expansion is emerging as the next proving ground to determine who will be victor in the ride-hailing market.
The race for control of the industry, which is estimated by Goldman Sachs to grow eightfold to $ 285 billion by 2030, is climbing with China's Didi Chuxing already surpassing Uber as the most valuable startup in the world. With a recent valuation of approximately $ 56 billion, compared to Uber's $ 48 billion, Didi is posing a real threat to Uber's operations and shows no signs of slowing down. Cementing its position as a top-hailing service in China, Didi is now turning its attention to another region of the world that is still filled with vast opportunities and not yet dominated by a single alternative taxi: Latin America.
Latin America such as Mexico City, Montevideo, and São Paulo, the region still presents an enormous opportunity for companies that can adapt and move fast enough.
Unlike many other regions of the world, Latin America is still very much connected to traditional forms of public transportation, such as trains, and subway systems. São Paulo, Mexico City, and Bogotá are more of an infrastructure overhaul. Large metro areas are already at or above maximum capacity during the peak hours, making owning and commuting with a more than a luxury. As a result, many commuters in Latin America are putting the emphasis on the use of alternative modes of transportation and on-demand services instead.
Beyond the rising demand for alternative transportation options, it's also worth noting that Latin America is the world's second-fastest-growing mobile market. In a region of approximately 640 million people, there are more than 200 million smartphone users. By 2020, predictions say that 63% of Latin America's population will have access to the Internet mobile. Latin American smartphone users have quickly adopted global apps, such as Uber and Facebook. However, tech companies have yet to fully tap into the region's potential.
Chilean taxi drivers demonstrate along Alameda Avenue against Uber's US on-demand service, in Santiago, on July 10, 2017.
Uber smartphone app has faced stiffness from traditional taxi drivers in the world over, and taxes in the United States. (MARTIN BERNETTI / AFP / Getty Images)
Uber
According to a Dalia survey, Latin Americans with smartphones are more likely to use a ride-hailing app or site. Overall, 45% have used an app, with 58% of Mexico.
Uber entered Latin America in 2013 and claims to have more than 36 million active users in the region, proving employment for more than a million drivers. The company quickly dominated Mexico, which is now its second-largest market after the U.S. In fact, up until recently Uber claimed a monopoly on ride-sharing in Mexico with few competitors. Latin American countries.
99 (formerly 99Taxis)
With an urban population of approximately 180 million, Brazil is the ultimate prize winner for ride-hailing and taxi companies with several competing services for market share. Mostly, 99 (formerly "99Taxis") was able to gain momentum with the help of other services (eg 99 TOP and 99 POP services) and better tools for its drivers.
With over 200,000 drivers and 14 million users, 99 attracted the attention of investors worldwide, including that of China's Didi Chuxing. Didi invested $ 100 million into 99 in January 2018 before acquiring 99 full months later Uber's operations in China.
Easy Taxi
Rocket Internet -backed taxi booking service, Easy Taxi, started in Latin America in 2011, two years after Uber first started in San Francisco. The company provides an easy way to book a taxi and track it in real-time. Today, the company is owned by Maxi Mobility, which acquired the company from Rocket Internet in 2017 for an undisclosed amount. Maxi Mobility also owns and operates many Latin American markets, including Argentina, Mexico, Bolivia, Panama, Brazil, Peru, and Chile, in addition to a handful of markets elsewhere.
To become a taxi driver in the region, Easy Taxi merged with Colombian taxi-booking app Tappsi in 2015. Tappsi launched in Bogotá in 2012 and was doing well in the Colombian market. Uber, the United States, has entered the region.
Easy Taxi has impressive traction, raising more than $ 75 million to date. But as the ride-hailing battle in Latin America pushes forward, the company is rumored to be a likely investment or acquisition target for Uber, Didi, the largest global investor in this space, Softbank.
Cabify
Cabify is a Spanish company that provides private vehicles for hire via its smartphone app. Although founded in Madrid, Cabify has already been a Latin American company, investing heavily across the region. The company was able to gain a strong foothold from its parent company, Maxi Mobility. In January 2018, Maxi Mobility raised another $ 160 million and said the funding would be used to accelerate both of its companies, Cabify and Easy Taxi, in the 130 cities where they operate throughout Spain, Portugal, and Latin America.
Cabify reported it has over 13 million users and grew its installed base by 500% between 2016 and 2017, tripling its user base and fulfilling six times more trips in 2017.
Cabify competes directly with Uber, 99, and Easy Taxi in Brazil; However, it is reportedly 40% market share in Sao Paolo, one of the largest cities in all of Latin America.
Beat (Formerly Taxibeat)
Beat is a profitable ride-hailing service founded in Athens, Greece that also operates in Peru. Latin America, but expansion to be limited to Chile for now.
As of January 2017, Beat had around 15,000 drivers and 800,000 customers in Peru.
Nekso
Toronto-based Nekso bet on the Latin American taxi-hailing market before its home market with a pilot launch in Venezuela in 2016. Nekso was able to gain acceptance of the taxi industries in Venezuela, Ecuador, and Panama with its different countries approach to ride-hailing.
The company connects to a network of 550+ licensed taxi companies and allows users to flag the phone. Nekso also uses artificial intelligence technology to offer drivers real-time updates on weather, events, and traffic data to predict areas of a city. The company claims taxi drivers can spend up to two-thirds of their day on the market. Nekso technology helps drivers increase their daily business by 25% percent.
At the end of 2017, Nekso boasted around 150,000 users and facilitated approximately 400,000 wrinkles per month. Now, the company plans to make its debut in South America, including Argentina, Colombia, Chile, and Peru.
99's new owner, Didi, who dominates the Asian market and was able to defeat Uber in China, has big plans for international expansion. Its acquisition of 99 reveals the potential in Latin America but also adds to the global web of global ride-hailing services.
Uber's assets in China, Uber for assets in Uber for $ 1 trillion. Uber, Didi, and 99 are all backed by Softbank. However, everywhere outside of China, Didi and Uber are competing with each other. Didi's full plans for 99 are not yet obvious, but the company has already set up an office in Mexico and has started the poaching of staff in Uber in Mexico.
With an infusion of capital, Latin America's ride-hailing industry is multiplying. That said, companies that want to compete in the region will need to be aggressive and strategic that can withstand the uniqueness of commuters and transportation options in the region. It is only a matter of time that we continue to monitor their operations for the sake of their domination of the world, or to scaffold them, and even more autonomous vehicles.
Two of the founders of 99, who sold their company to Didi, have already launched a dockless bike sharing startup called Yellow in Brazil and raised $ 9 million to grow its operations. No other scooter company has taken the plunge into Latin America yet besides Grin Scooters in Mexico City, but other larger cities such as Buenos Aires, Bogotá, Santiago, and Lima would be ideal safety issues first.
Didi's activity in Brazil and Mexico is sure to trigger a new wave of competition between existing ride-hailing players and create an even more tangled web of alliances and acquisitions. Whether or not these companies can be adapted to other types of transportation.
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