Uber raises price war with Ola Micro

Slashes its rates for Uber Go to Rs 6 a km from the existing Rs 8 a km in Delhi-NCR

From gift cards to fare cuts, Uber is battling rival cab aggregator service Ola. On Wednesday, the US-based entity, to compete with India-based Ola’s cheapest cab service, Ola Micro, cut its own rates for Uber Go to Rs 6 a km from the existing Rs 8 a km in the Delhi/National Capital Region. It has sent a series of mails to customers, offering everything from discounted rides to hefty gift cards for feedback.

In an e-mail on Thursday, it said it wanted customers to share their thoughts on a new Uber feature. “In-person meeting with an Uber researcher for 30 minutes. If you complete the meeting, you would receive Rs 500 Uber Ride Credits and a Rs 1,500 Amazon Gift Certificate,” went the mail.

According to Uber, this is only a feedback exercise, "to make the (mobile) app better". However, on Wednesday, the US-based entity, to compete with India-based Ola's cheapest cab service, Ola Micro, cut its own rates for Uber Go to Rs 6 a km from the existing Rs 8 a km in the Delhi/National Capital Region.

Price cuts, it said, were always tailored to each market and differed from city to city. "We're always iterating to achieve better outcomes for our riders and drivers. We experiment with new ways to offer riders more affordable and reliable ways to get from one place to another. Over the years, we have learnt that one of the most effective ways to boost demand is to cut prices for riders. Price cuts are designed to get more riders in cars and ensure drivers spend more time moving people, less time spent waiting around," its spokesperson said.

Market experts say the move would help it get back customers who shifted on to Ola, looking for more economical rides. "This move will ensure Uber Go is able to compete against Ola. However, Ola has a larger number of cabs as compared to Uber on its platform and would be able to play the volumes game," said a sector insider.

Uber, touted as the most valued start-up in the world (it is valued at $68 billion) recently raised $3.5 bn from Saudi Arabia's Public Investment Fund. With this, the total it has raised is $11 bn.