India’s oldest cab hailing firm Meru enters carpooling. What happens when Uber, Ola follow?

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Meru, India’s first large organized personal transportation firm, today announced the launch of a ridesharing service. The service, available on Meru’s existing app, offers a personal ridesharing option for people traveling in the same direction or area.

“[There’s] a growing consciousness amongst people about the need to reduce congestion, pollution, and stress associated with travel especially on daily traffic-heavy routes,” says Meru CEO Siddhartha Pahwa. “The carpool initiative aims to encourage a simple act of reducing the one-person per vehicle issue through a communal effort.”

A consumer can register with their mobile number, email address, or Facebook profile. The Meru app team conducts an elementary verification of the ride owner via their driver’s license, and the passenger through their identification card (such as the PAN card or Aadhaar card). Once successfully registered, the user can look up other registered members traveling on his or her route at a specific time and connect with them to avail or offer a ride.

According to a recent survey, one-fourth of commuters in India spend over 90 minutes per day traveling to work and meetings. In addition, one-third of respondents drive to work using their car, and half of that drive without any passengers.

Meru says the carpool service will enable personal vehicle owners and city commuter to reduce their daily travel costs and simplify their commute in a safe and secured environment.

Meru’s ICE (in case of emergency) feature on the app allows passengers to share details about their location to emergency contacts.

The ride payment transaction is conducted through the in-app PayTM mobile wallet.

No pilling cars in garage

Founded in 2007, Meru is one of the few government-approved cab hailing companies. Its arch rivals Ola and Uber are not authorized to ply in some regional markets like Indian capital Delhi.

Yet local competitor Ola has bagged US$625 million till date, while Uber has decided to infuse US$1 billion in its India operation. Meru, in contrast, secured US$75 million a year after its launch and raised another funding round of US$50 million from existing investor India Value Fund earlier this year.

Meru started off with an asset-heavy model of company owned cabs. When the likes of Ola and Uber entered the market with disruptive tech-driven tools to connect drivers with passengers, Meru followed suit. It launched Meru Plus, in which the cars are not owned by the company but by the drivers. Meru now has a fleet of about 12,000 cabs in 24 cities, most of which are not owned by the company.

Meru claims to have completed more than 40 million trips across India. It did not comment on the exact number of daily trips it enables. Ola and Uber claim to be clocking 750,000 and 200,000 daily rides.

Meru is not the first Indian startup to enter the ridesharing space. Earlier, local startups like RideInSync and Cubito entered the space but later they pivoted to employee transportation service due to inability to achieve scale.

With the service, Meru competes with Rocket Internet-backed Tripda and Europe’s BlaBlaCar.

Uber is known to have carpooling services in other countries. It hasn’t launched in India yet. And Ola is sure to enter the space. When they do, it isn’t clear if Meru will have a competitive advantage.

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