Taxi Market - Growth, Trends, and Forecast (2020 - 2025)

The Taxi Market is segmented by Booking Type (Online Booking and Offline Booking), Vehicle Type (Motorcycles, Cars, and Other Vehicle Types (Van)), Service Type (Ride Hailing and Ride Sharing), Preference Type (Urban Commute, Outstation, and Rental), and Geography.

Market Snapshot

Study Period:

2019-2025

Base Year:

2019

Fastest Growing Market:

Asia Pacific

Largest Market:

Asia Pacific

CAGR:

10.08 %

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Market Overview

The taxi market is expected to register a CAGR of 10.08%, during the forecast period 2020-2025.

  • Reduced taxi fare and ease of booking through mobile apps are the major factors that has driven the online booking segment to capture a major share, worldwide. With the advent of e-hailing taxi applications, such as Uber, Lyft, Ola, etc., taxi services have been one of the game-changing innovations of the transportation sector.
  • Passengers’ preferences for utilizing taxi services and ride-sharing services across developing countries, such as India, China, and Vietnam, have increased. This has led to companies enhancing the options and expanding their operations to be provided in mobile applications to retain their respective market share in the highly competitive market.
  • The Asia-Pacific region captured a major share of the market, accounting for more than 70% of the global motorcycle/bike taxi market in 2018. Increasing traffic congestion and low taxi fare, when compared to other modes of transportation, are the major factors driving the growth of the motorcycle/bike taxi service in the Asia-Pacific market.

Scope of the Report

The taxi market covers the latest trends and technological development in the taxi market, demand of the booking type, vehicle type, service type, preference type, geography, and market share of major used taxi service providers across the world

By Booking Type
Online Booking
Offline Booking
By Vehicle Type
Motorcycles
Cars
Other Vehicle Types (Van)
By Service Type
Ride Hailing
Ride Sharing
By Preference Type
Urban Commute
Outstation
Rental
Geography
North America
United States
Canada
Rest of North America
Europe
Germany
United Kingdom
France
Spain
Rest of Europe
Asia-Pacific
China
India
Japan
Australia
Vietnam
Rest of Asia-Pacific
Rest of the World
Mexico
Brazil
South Africa
Other Countries

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Key Market Trends

Stringent Regulations are Hampering the Market

Stringent rules and regulations govern the taxi industry. App/internet-based taxi services are often accused of unfair competition with the local taxi market, and this has resulted in various standoffs between the major players and authorities and taxi associations.

In the United Kingdom, Uber is accused of having a driver registration system that is easy to cheat. In November 2019, it was found that nearly 14000 customers have taken rides with unregistered drivers. According to regulators and authorities, this led to traffic congestions, tax evasion, unfair competition with traditional taxi drivers and compromised safety. In 2017, Uber was accused of neglecting the safety of riders and not sharing the data with the operator. This resulted in the cancellation of Uber’s license. Uber is banned in Barcelona, Frankfurt, and Budapest.

In 2015, China’s transport ministry released a set of rules and regulations to integrate internet-based car-hailing services with the taxi management system. However, these regulations had mostly negative impacts on the taxi market. The government controls the entry and exit of taxis in the market. The population of Beijing rose by almost 50% from 14 million to 21 million during 2004-2015, however, a number of taxis experienced a minute increase from 65000 to 66000 during the same period. This is resulting in a widening of demand and supply gap. Fare control is another reason that is damaging social welfare. Insufficient sharing of information between the market and the government is leading to inaccurate equilibrium prices, which results in the customers ending up paying higher prices than the actual price. Reduction in subsidies for drivers and customers is also a major factor responsible for hampering the growth of the market.

In India, Ola’s license was canceled for 6 months in March 2019 by the Karnataka State Transportation department on account of operating a bike taxi service, while Ola only had the license to operate 4-wheeler taxi service.

 

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Asia-Pacific - Leading the Taxi Market

The taxi market is on the rise in the Asia-Pacific. Players, like DiDi Chuxing, Ola, and Onda, are using the high smartphone penetration rate in Asia-Pacific to their full advantage and are capturing the market share through innovation and cutting-edge technology. These South Asian taxi giants are acing the competition in local geographies and are expanding overseas. Chinese taxi giant Didi Chuxing has started operations in Mexico, Australia, Costa Rica, Japan, and many other countries, whereas the Indian market leader Ola is serving in Australia, New Zealand, and the United Kingdom.

In China, DiDi Chuxing holds 90% of the market share and serves more than 550 million customers. DiDi Chuxing is all set to launch its self-driving robo taxi service in Shanghai, China, and it raised an independent company Didi Autonomous Driving after the government permitted the testing of autonomous vehicles in August 2019. According to Tiger Qie, DiDi’s Chief Technology officer and Vice president, only 65% of customer requests are being fulfilled by DiDi at present. The introduction of robo taxis is a move that will narrow the demand and supply gap.

In India, the taxi market is evaluated at nearly 10 billion dollars, and it is expected to reach 25 billion dollars by 2025. Ola holds a market share of 58% (app-based/organized taxi market). Uber stands second with a market share of 38%. The competition in India is very stiff and sophisticated. Although smartphone penetration is satisfactory, Ithe country still struggles with poor internet connectivity and transport infrastructure. Ola is expanding and now provides services in 125 cities, whereas Uber is strengthening its technological framework although it is functional in 36 cities. Owing to the rise in disposable income of Indian customers and its increased expenditure on travel, key players are now introducing value-added features, like rear-seat entertainment, WiFi, and outstation services to gain market share in niche segments.

In South Korea, Seoul Taxi Association and Seoul Private Taxi association entered into a partnership to launch Onda. This taxi service uses artificial intelligence to optimize and enhance the customer experience. In existing apps, whenever a customer initiates a request, it goes to available drivers in that area. If the destination is far away from the pickup point, the drivers tend to ignore the request, creating difficulty for customers. Onda, however, automatically deploys the driver closest to the customer in one-kilometer vicinity.

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Competitive Landscape

Some of the major players in the taxi market include Uber, Grab, Lyft, Ola, etc. Among them, Uber's main strategy to expand its business is to focus on upcoming technologies, like automated driving vehicles. In 2018, the Toyota Motor Corporation announced to invest USD 500 million in Uber technologies, to develop self-driving cars, and aims to deploy them in Uber ride-sharing network by 2021.

The key players in the industry are investing a lot of money in technology. Uber and DiDi Chuxing are working on self-driving cars. Focus is on enhancing the customer experience. In India, there has been a surge in number of customers opting for outstation services. This has led to players, like Ola, Meru, and Prydo, to offer value added services to their customers at very competitive prices. Ola partnered with Apple Music and other music and video streaming services for its prime play service.

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Table Of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Drivers

    2. 4.2 Market Restraints

    3. 4.3 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.3.1 Threat of New Entrants

      2. 4.3.2 Bargaining Power of Buyers/Consumers

      3. 4.3.3 Bargaining Power of Suppliers

      4. 4.3.4 Threat of Substitute Products

      5. 4.3.5 Intensity of Competitive Rivalry

  5. 5. MARKET SEGMENTATION

    1. 5.1 By Booking Type

      1. 5.1.1 Online Booking

      2. 5.1.2 Offline Booking

    2. 5.2 By Vehicle Type

      1. 5.2.1 Motorcycles

      2. 5.2.2 Cars

      3. 5.2.3 Other Vehicle Types (Van)

    3. 5.3 By Service Type

      1. 5.3.1 Ride Hailing

      2. 5.3.2 Ride Sharing

    4. 5.4 By Preference Type

      1. 5.4.1 Urban Commute

      2. 5.4.2 Outstation

      3. 5.4.3 Rental

    5. 5.5 Geography

      1. 5.5.1 North America

        1. 5.5.1.1 United States

        2. 5.5.1.2 Canada

        3. 5.5.1.3 Rest of North America

      2. 5.5.2 Europe

        1. 5.5.2.1 Germany

        2. 5.5.2.2 United Kingdom

        3. 5.5.2.3 France

        4. 5.5.2.4 Spain

        5. 5.5.2.5 Rest of Europe

      3. 5.5.3 Asia-Pacific

        1. 5.5.3.1 China

        2. 5.5.3.2 India

        3. 5.5.3.3 Japan

        4. 5.5.3.4 Australia

        5. 5.5.3.5 Vietnam

        6. 5.5.3.6 Rest of Asia-Pacific

      4. 5.5.4 Rest of the World

        1. 5.5.4.1 Mexico

        2. 5.5.4.2 Brazil

        3. 5.5.4.3 South Africa

        4. 5.5.4.4 Other Countries

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Vendor Market Share

    2. 6.2 Company Profiles

      1. 6.2.1 Uber Technologies Inc.

      2. 6.2.2 ANI Technologies Pvt. Ltd (Ola)

      3. 6.2.3 mytaxi

      4. 6.2.4 Lyft Inc.

      5. 6.2.5 Yellow Cab

      6. 6.2.6 Didi Chuxing

      7. 6.2.7 GrabTaxi Holdings PTE Ltd

      8. 6.2.8 Go-Jek

      9. 6.2.9 Kabbee

      10. 6.2.10 Hailo

      11. 6.2.11 Flywheel

      12. 6.2.12 Curb

  7. *List Not Exhaustive
  8. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

** Subject to Availability

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