Indian Customer Is So Demanding, Doesn’t Want To Pay For Anything: Uber CEO

It can often take a foreign founder to say what Indian founders have known all along.

Uber CEO Dara Khosrowshahi has said that the Indian customer is extremely demanding, and doesn’t want to pay much for services. Khosrowshahi was speaking at a fireside chat with Nandan Nilekani in Bengaluru. “India is one of the toughest markets out there; they are so demanding and do not pay for anything. If we can succeed here, we can succeed anywhere else,” he said.

Khosrowshahi also said that Uber was looking to expand its low-cost segment in India. These would include its two-wheeler and three-wheeler services. “One of the strategic single biggest opportunity is lower cost products like two-wheeler and three-wheeler… We are also getting into bus in some countries,” Khosrowshahi said.

This would be quite the 180 for Uber, which had first entered India more than a decade ago offering high-end cars at the rates of a regular taxi. The company had quickly managed to garner users, and had slowly tried to wean them off the fancy cars and on to more regular vehicles. Users had largely responded, and Uber and Ola had formed a duopoly in India’s cab hailing space. But Uber now seems to feel that its growth is slowing in the cab hailing market, and is looking to further focus on two-wheeler and three-wheeler space for India’s price-conscious consumers.

There have been other bumps along the way for the company too. Uber had launched UberEats in India, but it consistently bled money, thanks to dirt-cheap prices being offered by rivals including Zomato and Swiggy. Uber eventually bowed out, and sold UberEats to Zomato in 2020. Uber hasn’t yet figured out how to make money in India — while the global parent reported its first global profit last year, Uber India reported a loss of Rs. 311 crore in FY23.

And Khosrowshahi’s refrain about Indians being really demanding customers and being unwilling to pay will ring true with almost all Indian founders. Very few customer-facing Indian startups have managed to make money, and most have fallen prey to Indian users being unwilling to pay very much for services. This is also apparent in the data provided by other multinational giants — an average Facebook user in India, for instance, makes the company a fraction of the money compared to users in developed markets. And when the CEO of a company that runs cabs in 70 countries says India might be the hardest of them to make money in, there might be more than a grain of truth behind the assertion.