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Uber will continue to burn capital in India: Dara Khosrowshahi

Uber says it will leverage the profits it makes from developed markets in the US and Europe to fund the losses of its Indian business

Alnoor Peermohamed  |  Bengaluru 

Dara Khosrowshahi, CEO, Uber Technologies
Dara Khosrowshahi, CEO, Uber
US ride hailing giant will continue to burn capital in India as it looks to edge out homegrown rival Ola, said in an interview with a news channel. also dismissed the speculation that a merger between the two ride-hailing firms was on the charts.

says it will leverage the profits it makes from developed markets in the US and Europe to fund the losses of its Indian business. This had been one of the key contentions for Ola to seek protection from the against the onslaught from back in 2016, arguing that it wasn’t fair.

“I think we’re going to be quite aggressive in India as far as investment goes. One of the great structural advantages that we have at is that we have many profit pools. Those profit pools in the mature markets in the US and Europe, allow us to actually lean into some of the developing markets,” said Khosrowshahi, in an interview with ET Now on Thursday.

Both and Ola have burned billions of dollars over the past four years in subsidising rides for customers and paying incentives to drivers. has leveraged its global cash machine advantage and massive funding it has raised, Ola had to rely solely on the equity capital it has raised from investors such as and

Given that is now a common investor in both firms, speculation has been ripe that will sell its India unit to Ola in return for a hefty stake in the Indian company. However, in the interview dismissed the claims, adding that while it was fun to speculate no such deal was on the charts.

“My focus is on our quality of operations and our teams, that’s why I’m here. I’m here to meet with our teams, ministers, etc, to understand the market, and at this point I’m not really focused on M&A, although it’s certainly fun to speculate about,” added Khosrowshahi, who took over as of from founder in August last year.

While Ola is considered to be in the lead in India, a top executive at the Indian firm who did not want to be named, admitted that and Ola were neck and neck in the cab hailing space. Ola’s advantage largely comes from the autorickshaw category in which has only recently entered, and is also one of the reasons Ola is investing so heavily in it.

He added that Ola loses about Rs 70 per auto ride currently, but that’s far lower than what the company loses for every cab ride.

Globally, has already made it clear that wants to be a transportation company and not just an app that allows customers to hail cabs. “I want to run the bus systems for a city,” he was quoted saying by the Financial Times at an event earlier this month. “I want you to be able to take an and get into the subway... get out and have an waiting for you.”

Those ideas are on similar lines to what Bhavish Aggarwal, co-founder and of Ola has. Ola has already experimented with running a fleet of buses in some Indian cities and has also diversified its offering to include autorickshaws, motorcycles and even bicycles. recently got back into the auto hailing space and it is to be seen if it tries its hand at other modes of transport as well in India.

First Published: Thu, February 22 2018. 14:44 IST