India's Zoomcar to launch cab rental product to test demand in larger market
By Akash Sriram
Dec 20 (Reuters) -Zoomcar ZCAR.O will launch a chauffeur-driven cab rental product in the southern Indian city of Bengaluru as it looks to test the waters in a larger part of the transportation market, the self-drive car-sharing platform told Reuters on Friday.
The move comes months after the cash-strapped company terminated co-founder Greg Moran as CEO after an over a decade-long tenure at the helm that saw the firm go public in the United States.
Zoomcar could face stiff competition in a market dominated by well-heeled players like Ola and Uber UBER.N that primarily offer intra-city ride-hailing services, but also offer cab rentals.
The company said it will offer rentals for durations ranging from two hours to over a month, aiming to cater to greater demand for cars with drivers compared to its current self-drive options.
"If we look at the market in India, most of the market is always coming with drivers. So that is actually bigger for sure," CEO Hiroshi Nishijima said in an interview.
Earlier this year, Zoomcar exited international markets citing a funding crunch and high marketing costs to grow outside its home market, India.
In November, the company said it had substantial doubt about its ability to continue as a going concern amid continuing losses and the need to raise funds to meet debt and working capital needs.
The cab rental product will be available on Zoomcar's app and customers will get to choose specific cars instead of a category of vehicles.
The firm will aggregate cars and drivers for the service, a model usually implemented to minimize costs related to acquiring assets and employing staff.
The company does not plan to burn cash to provide discounts and incentives to compete in the cab rental market, but will price the service attractively, the CEO said.
Zoomcar is raising funds and expects to use proceeds to repay debt, cover monthly losses and invest in growth, Nishijima said.
Reporting by Akash Sriram in Bengaluru; Editing by Mrigank Dhaniwala
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