A recent Goldman Sachs study projected that the worldwide ride-sharing market could grow eight-fold by the year 2030, reaching $285 billion annually. Currently ridesharing is about $36 billion.
Right now, they estimate the global taxi market is worth $108 billion, which is triple the size of the $36-billion ride-hailing market. At the same time, they calculate an average of 15 million ride-hailing trips a day globally, which they expect to increase to 97 million by 2030.
That would translate to $65 billion in revenue for the ride-hailing companies by 2030, based on the assumption that the companies would take a 23% commission from gross market sales.
Didi Chuxing in China, bought Uber’s operations in that country last year and has invested in Lyft and India’s Ola as well.
Didi has become Asia’s most valuable startup, worth some $50 billion based on a recent funding round.
Uber’s new chief executive has vowed to take the company, valued privately at nearly $70 billion, public with a stock market debut by the year 2019. Lyft, with a valuation near $11 billion, is reported to be mulling a strategy to also go public.
Uber lost about $600 million in the second quarter of this year, after losing $2.8 billion in all of 2016. Ridership nevertheless is soaring.
Such red ink on balance sheets has not deterred investors with the resources of Alphabet or SoftBank, with amounts they have sunk into ride-sharing startups considered “pretty modest,” Jack Gold of J.Gold Associates told AFP.
Data from Ride-sharing is valuable
Ride-sharing services get to know about travel habits, schedules, and profiles of passengers and drivers, typically analyzing information with software to anticipate demand and improve service.
Such data can also be a treasure trove to mine in the development of self-driving cars, which have been touted as the future of urban transport.
With cars navigating themselves, passengers will likely spend more time immersed in on-board entertainment or services, likely streamed via wireless internet connections. Google and other online titans would profit from going along for the ride.
Human drivers are considered a prime expense for ride-sharing firms, which Goldman Sachs research found to be a “significant contributor” to the lack of operating profit. Fully autonomous vehicles could eliminate about 6.2 million drivers in the workforce, according to Goldman Sachs.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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