Reliance Jio Cabs: the next step for RIL after its telecom success

For over a year, reports about Reliance Industries venturing into the cab service industry has been doing the rounds of the rumor mills. The end of February 2017 saw some reports about Reliance Jio ordering 600 cabs to kickstart the services.

FactorDaily reported an unnamed source that the launch of the cab services depended on the commercial launch and success of Reliance Jio.

It is no secret that if the company ventures into this area, it will resort to aggressive pricing and back it with lucrative offers, just as it did with Jio telecom. Latest rumors suggest that the services will cost as low as INR 3/km.

The app-based service is said to operate the company’s cars and of independent cab drivers who choose to associate themselves with Reliance Jio Cabs. The rumor mills also suggest that the services will first start in Bangalore and Chennai.

Needless to say that the company will look to pursue a mixed strategy where it will target the big and the small cities. Currently, cities like Bhopal and Jodhpur haven’t seen much of Ola and Uber. So, if Jio is to enter the untapped market in these cities, the venture could prove to be very profitable.

Two offer pillars

CNG- Reliance Industries has a strong hold in the CNG market, therefore the company owned cabs could have the option of using their own CNG which will cost the company much less as compared to what it costs the likes of Uber and Ola.

Jio- Ola has already started Wi-Fi for its passengers. It is pretty clear that it is using the driver’s smartphone as a hotspot device to offer the service. The cost of this is additional. Jio, on the other hand, can provide this service at almost not cost.

Reliance Industries has made no official statement about this. Regardless of the fact that the rumors have been heating up for over a year, nothing is certain. At the moment, all one can do is wait and watch.

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