Ride Sharing Market size worth over $50 Bn by 2026
Published Date: November 4, 2020 Authors: Preeti Wadhwani, Prasenjit Saha
Ride Sharing Market size is set to be over USD 50 billion by 2026, according to a new research report by Global Market Insights, Inc.
Emergence of new players in the global market will fuel the ride sharing industry growth. The barriers to entry are eased by supportive government policies and new regulations that promote the use of alternative mobility solutions. Industry updates report that in April 2019, the New York transportation department invested USD 3 million to promote shared mobility in the state.
One of the major market factors driving the growth of ride sharing services is the advancement in connected technologies. Innovations in the field of IoT and AI significantly assist in improving the accessibility and adoption of carpooling services. For instance, in January 2020, Qualcomm, Inc. announced its car-to-cloud service that enables ride sharing platforms to efficiently connect and route multiple cars.
Industry challenges include lack of consumer trust and confidence in ride sharing services. Commuters feel uncomfortable while travelling with strangers, especially for long distances. Increasing safety concerns related to ride sharing are expected to hamper the market growth through 2026. The growing number of theft and robbery incidents occurring in carpooling activities is impacting the confidence levels of commuters. However, advanced location detection and driver information provided by carpooling platforms are expected to improve the market statistics.
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Analyst view: “The P2P ride sharing business model is expected to witness high growth due to increased flexibility and ease of carpooling with nearby passengers. Convenient payment options offered by this model will contribute to the growing industry size.”
The outbreak of the COVID-19 pandemic in December 2019 has severely impacted the transportation industry. Stringent nationwide lockdowns enforced by countries across the globe led to shutdown of corporate offices and businesses. Several companies implemented work-from-home policies for the safety of their employees, impacting the revenues of carpooling services in the market. Commuters are highly inclined towards travelling in their own vehicles even post lockdown due to the risk of infection from other passengers while carpooling. The ride sharing market is expected to witness a steady growth with the reduction in pandemic impacts.
Browse key industry insights spread across 150 pages with 109 market data tables & 21 figures & charts from the report, “Ride Sharing Market Size By Business Model (P2P, B2C, B2B), By Vehicle Type (ICE, CNG/LPG, Electric), Industry Analysis Report, Regional Outlook, Application Potential, Price Trend, Competitive Market Share & Forecast, 2020 – 2026” in detail along with the table of contents:
Comfortable and safe transport options provided by B2C carpooling model
The B2C model accounted for over 55% of the market share in 2019 owing to the high penetration of B2C ride sharing service providers such as Uber, Lyft, and OLA. This business model offers commuters a cost-effective and comfortable way to address their daily transport requirements. The competitive pricing of carpooling services offered by market players is attributable to the wide-scale adoption of these services.
B2C ride sharing companies are introducing new features to ease rider anxiety and improve safety of their rides. For instance, in February 2020, Uber launched its RideCheck feature to enhance the safety of its customers in Canada. The feature allows Uber to monitor the ride and instantly take action in case of an emergency. It also enables riders to dial 911 in case of an accident or a mishap.
Growing demand for ICE cars driving the ride sharing industry
The ICE segment is expected to grow at around 6.5% CAGR through 2026. The segment is anticipated to experience a steady growth due to the increasing adoption of electric vehicles. ICE vehicles are increasingly popular in price-sensitive markets, such as India and China, owing to low initial investments. Electric cars are expensive in nature and require high investments from ride sharing companies operating in low-income economies.
High consumer inclination toward modern mobility solutions in Europe
Europe ride sharing market share is predicted to reach USD 8.5 billion by 2026 owing to the changing car ownership pattern in the region. This trend is amplified by the plummeting passenger vehicle sales in the regional market. According to the market data reported by the French Automobile Manufacturers Committee (CCFA), in 2019, passenger vehicle sales grew by only 1.9% year-on-year as opposed to 3.0% in 2018.
The residents of European countries including Germany, France, and the UK are highly inclined toward using public transport and shared mobility services for their routine commute. The presence of leading market players, such as Lyft, DiDi Chuxing, and Uber, in Europe is providing several opportunities to the market.
Ride sharing market players are focusing on expansion of their services in international markets to increase their penetration. For instance, in August 2020, DiDi Chuxing launched its ride hailing and sharing services in Russia, marking the company’s expansion in Europe. Similarly, in January 2019, the company expanded its operation in Brazil by acquiring 99, a local carpooling company for approximately USD 900 million. Partnerships with automobile OEMs is another major strategy adopted by industry players.
Key players in the market include Uber, Lyft, Bla Bla Cars, Careem, Lyft, Scoop, sRide, Via, Grab, ZIFY SAS, DiDi Chuxing, and Quick Ride.