As more and more Indian companies urge their employees to work from home amidst the rising number of novel coronavirus cases in the country, cab-hailing startups Uber and Ola, which rely heavily on corporate travels and airport commutes, have started to bear the brunt of it.
Many Bengaluru-based startups including e-tailer Flipkart, food-delivery giant Swiggy, online stock broking company Zerodha, fintech firm Instamojo, social commerce startup Meesho, edtech company Unacademy, and mobility startup Bounce have made work from home mandatory for their staff. Ola, itself, is one among these startups taking these preventive measures. Moreover, IT companies like Wipro and Tech Mahindra, which have the majority of the workforce based in Bengaluru, have followed the suit.
In Delhi, payments firm Paytm and Uber have reportedly offered their employees to work from home. Several Indian companies have also halted business travel outside and within the country.
For the cab-hailing giants, metros like Bengaluru, Hyderabad, Chennai, and Delhi-NCR (National Capital Region) are critical markets and add significantly to their ride numbers. Office commutes by employees, corporate travel, and rides to and from airports, constitute a huge chunk of business for them. With India Inc. opting to work from home, the travel within the city has also gone down dramatically, impacting the business of ride-hailing startups to a large extent.
Local media Economic Times (ET) reported that Uber and Ola’s rides went “down by as much as one-third” over the past week, citing insiders and driver associations and company insiders.
“Business has dried up completely. There has been a 40-50% drop since the last one week as all companies have given their employees permission to work from home,” Tanveer Pasha, president of OTU Drivers and Owners Association, told ET.
Corporate travel has also gone down since businesses are now starting to opt for online meetings and events as a preventive measure. For instance, corporate transport solutions provider MoveInSync, which clocks over 100,000 cab trips per day, is seeing a 10% drop in business pan-India, the ET report said. Employees are using personal vehicles to commute whenever required to avoid coming in contact with people who may be unknowingly carrying the virus.
The impact is not only on the demand but also on the supply side.
According to OTU’s Pashu, around 5% of drivers working with the ride-hailing platforms have left Bengaluru for their hometowns “fearing they would be infected as the job puts them in close contact with hundreds of people.”
On Friday, the confirmed COVID-19 cases in the world’s second-most populous country reached 77. Given the uncertainty of this health pandemic to come under control, travel is expected to get hit the hardest among all industries. This essentially means ride-hailing giants have to brace themselves for tougher times ahead.