Ola Micro spearheads company's fight against Uber

App-based taxi service company Ola claims its newest category Ola Micro is gaining significant traction in the market, helping it ward off an attack from larger global rival Uber in India. Within three weeks of launching the service, the Bengaluru-based firm says that the category has seen as many rides as all rides put together in the previous three years.

Launched as a pilot in Bengaluru, Ola Micro offers customers rides at Rs 6 per km with a minimum fare of Rs 50. This matches fares offered by TaxiForSure's (a rival Ola acquired for close to $200 million) hatchback category which is also on offer on Ola's app.

"There was a need for air conditioned car comfort at more affordable costs with for instance say a car like the Datsun Go. These compact cars at micro prices caters to a segment that does not use cars at this moment," said Raghuvesh Sarup, chief marketing officer and category head at Ola.

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By separating subcompact and regular hatchbacks on its platform, Ola has been able to quickly scale Ola Micro to seven cities - Bengaluru, Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Pune. Customers will have on offer rides in cars like Datsun's GO, Suzuki's WagonR and Hyundai's EON when they ride with Ola Micro, compared to slightly larger vehicles in Mini.

The launch of its newest category comes at a time when Ola is warding off an attack from Uber, which recently claimed that its operation in India would be larger than its local rival within a month. Ola too hit back, stating that in three weeks, its Micro category sees over 50 per cent of the total number of rides Uber does on any given day.

"In three weeks, we have put up a category (Ola Micro) which is already 50 per cent of all of Uber's daily bookings in the country. The rate at which Micro is growing, it will be larger than their entire brand within a month," added Sarup.

While Ola Micro might eat into some of the other categories on the company's platform, by virtue of minimum fares and comfort levels, Ola believes that each will have its share of takers. Autorickshaws due to their low minimum fare are best suited for short trips, while a user of Ola Mini would want the comfort of a slightly larger car and Ola Prime would be for people who want to travel in luxury.

Sarup said that he sees customers using Ola Micro for their daily commute because of how economical it is, but would opt for a larger Ola Mini or even Ola Prime sedan when going out with their families over the weekend. Moreover, gauging the success of the category, the company will look to introduce Ola Micro in all cities where it sees good demand from in the near future.

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