Ride Hailing Services Market To Hit Value $82.37 Billion By 2025 |Grand View Research, Inc.


The global ride hailing services market size is expected to reach USD 82.37 billion by 2025, according to a new report by Grand View Research, Inc. It is projected to register a CAGR of 12.8% during the forecast period. Rising need to combat the rushing traffic coupled with pilling road taxes is expected to expand the scope of ride-hailing services. These rides are easily traceable and the contacts of both the passenger and driver are easily accessible. This factor is projected to bode well for the adoption of these services. Low cost of car ownership and growing employment opportunities is expected to open new avenues over the next few years.
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In January 2019, TukTuk-Ride launched a new ride hailing service app for ten major cities in India. The consumers have to pay INR 14 per kilometer for cabs and INR 8 per kilometer for bike taxis. The organization is also planning to expand their services by incorporating luxury cars, vintage cars, e-bikes, deliver vehicles, and ambulances in the same service segment. Dallas-based Alto launched its ride hailing service in January 2019, through the funding of USD 14.5 million from companies including Road Ventures and Frog Ventures. The company will expand to more U.S. cities by the end of 2019.
Some of the automotive manufacturers are expected to enter the market to maintain their customer base over the next eight years. For instance, developing economies including China and India are expected to remain some of the favorable destination as a result of urbanization and expansion of middle-income population. Furthermore, other cab hailing services are entering the China ride sharing service market. For instance, in October 2018, SAIC Motor, Geely and Daimler jointly announced plans for new ride hailing services in China. Additionally, BMW initiated its premium service, ReachNow for China in January 2019. The new venture has a crew of drivers to chauffer rides in a fleet of 200 BMW 5 series. The organization plans to include Mercedes-Benz E-Class and Audi A6 in the fleet. The service will cost around USD 3 per kilometer.
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In January 2019, Grab Holdings Inc. announced plans for commencing three new ride hailing services under the names, GrabShuttle, GrabCall, and GrabCall in Myanmar. GrabShuttle will be targeted at office workers and university students and GrabCall will allow booking cabs through call center agents. Grab Web Booking allows booking trips through online portals.
Further key findings from the report suggest:
·         E-hailing offering segment accounted for more than 50% of the market share in terms of revenue in 2018
·         Car rental offering segment is expected to register the fastest CAGR of 13.8% from 2019 to 2025
·         North America held a market share exceeding 35% in 2018 and is anticipated to register significant growth over the forecast period
·         Asia Pacific is expected to witness the fastest CAGR of 13.9% in the ride hailing services market during the forecast period
The global ride hailing services market size was valued at USD 34.45 billion in 2018. The growing urban population in developing economies including China and India is expected to remain a favorable factor. Mobility-as-a-Service (MaaS) is inspired by the anticipation of self-driving cars, which are expected to reduce the price of ride hailing services significantly. Furthermore, the financing activity for owning a car has been made easier and cheaper by reducing the rate of interest by banks and lenders. Organizations are innovating the services by hiring fleets of automated vehicles for ensuring better passenger safety and comfort.
Rising preference for carpool and bike pool services among regular office commuters is anticipated to create growth opportunities for the market. These services have proved to be beneficial for commuters as they can cut their expense pertaining to gas and parking by more than 50%. The service allows the riders to travel with comfort at discounted prices. Pooling can improve air quality by reducing the number cars and traffic on the road. In Europe, Germany has the highest rate of adoption of carpooling and it is followed by France.
Customers can a hatchback, sedan, and SUV amongst others. Ride hailing enables them in outrunning the conventional public transportation services. Furthermore, these services allow them to choose the convenient pick-up and drop locations. Some of the services such as Ola and Uber also facilitate real-time vehicle tracking, sharing it with one’s kin and friends, feedback, and rating system. The availability of multiple service providers has given customers an edge as it gives them a chance to compare the service and rates. A recent study by the University of Pennsylvania highlighted that the expansion of ride hailing services has reduced the instances of drunk driving, which makes these vehicles a safer option.
Another important factor driving the ride hailing services market is the shifting preference of the masses from driving a car to being driven. Rise in demand for luxury car services at affordable prices, especially among millennials is anticipated to create growth opportunities for the market. Majority of millennials avoid buying cars, saving the ownership, maintenance, and fuel costs along with road tax. Increasing use of public transport is reducing traffic congestions and is proving beneficial for the environment. A common trend that has been noticed in countries including India, China, and Australia is the payment made by digital mode owing to the convenience it offers to both drivers as well as passengers.
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Grand View Research has segmented the global ride hailing services market on the basis of offering:
Ride Hailing Services Offering Outlook (Revenue, USD Million, 2015 - 2025)
·         E-hailing
·         Car Sharing
·         Rental
Another major factor positively influencing the growth is the increasing use of digital money. With governments across the globe focusing on digital payments, ride hailing services have evolved as the medium of public transport that support the cause. These companies accept payment by digital wallet, unified payment interface, net banking, and various other e-payment methods. In India, the demonetization in November 2016 offered a leverage to the companies operating in the country. They became the first choice of people for travelling owing to the convenience of payment. Post demonetization, the industry saw three times increase in the demand for the services.
E-hailing was the largest segment, with a market share of more than 50% in 2018. The growth is attributed to user-friendliness and convenience these services offer. These services have made travelling around in new cities easier by offering them trained drivers using reliable maps for navigation. Along with this, the app related algorithms make price estimation for a ride easier, which reduces the chances of being cheated by a driver. Also, the convenience of hiring a cab by a single tap on mobile is expected to continue the growth in the upcoming years.
About Grand View Research
Grand View Research, Inc. is a U.S. based market research and consulting company, registered in the State of California and headquartered in San Francisco. The company provides syndicated research reports, customized research reports, and consulting services. To help clients make informed business decisions, we offer market intelligence studies ensuring relevant and fact-based research across a range of industries, from technology to chemicals, materials and healthcare.


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