The global ride sharing market is projected to grow from USD 85.8 billion in 2021 and reach USD 185.1 billion in 2026, at a CAGR of 16.6%.
COVID-19 pandemic has impacted ride sharing business for a consecutive second year. However, according to experts, the ride sharing industry would start its complete recovery from Q3 of 2021 or Q1 of 2022, and the key factor that would drive the demand for ride sharing is urbanization. The majority of the population living in cities has shifted to their countryside; still, the urbanization rate in 2020 was close to 56% globally, which was 55% in 2019.
However, post-pandemic the more population is expected to return to the cities, which is expected to further increase the urbanization rate. This would bring back the urbanization rate, and slowly the basic needs of the population would start rising; transport would be one of these. Considering the second COVID wave and the expected third wave, this change would take place slowly. This would be the foremost driver for bringing back the ride sharing industry revenues back on track.
Additionally, though urbanization would be a key driver for the ride sharing industry, the pandemic's effects would be seen on ride sharing models for the initial period. For instance, after the pandemic period, people would still be hesitant to opt for shared services and public transport, and they would prefer e-hailing or car rentals.
Most of the ride sharing services have shifted from web-based to app-based, and the key reason is an increase in popularity & options available on smartphones. Additionally, internet penetration has showcased significant growth in the last 3-4 years. According to World Economic Forum, in 2019, internet usage is doubled from 2010.
Hence, a rise in urbanization, an increase in penetration of smartphones, and a growth in internet penetration together would fuel the demand for ride sharing in coming years.
Globally, the Electric vehicle segment is expected to be the fastest-growing segment during the forecast period.
Recent initiatives taken by major ride sharing provider companies such as Uber, Free Now, Bolt, and Lyft, to electrify their fleet partially by 2025 and fully by 2030 are expected to drive the electric vehicle ride sharing market during the forecast period.
Moreover, in China, according to David Xu, Didi's head of strategy, a whopping 21% of the ride-hailing fleet is electric. Beijing-based Didi Chuxing Technology Co., the world's largest ride-hailing company, has about 1 million EVs on its network, with a goal to hit 10 million by 2028.
Asia Pacific is projected to be the largest regional market
Asia Pacific accounts for a significantly lower number of vehicles per 1,000 persons as the per capita income in most of these countries is lower than in Western countries. Hence, ride sharing offers users a sense of owning a vehicle at a much lower cost than actually owning one. Therefore, consumers prefer ride sharing services over personal vehicles.
Additionally, factors such as a rise in the daily commute to workplaces in urban areas and an increased need to save fuel by providing a ride to commuters and colleagues heading along the same route are anticipated to fuel the Asia Pacific ride sharing market.
The increasing number of megacities and the population growth in developed and developing countries have increased the importance of deploying a smart transportation network. The ride sharing services in Asia Pacific are growing rapidly because of the demand in countries such as China, India, and Japan. These countries have started recognizing ride sharing as a solution to curb issues such as traffic congestion, air pollution, and greenhouse gas emissions.
Didi Chuxing (China), Uber Technologies, Inc (US), Gett (Israel), Lyft, Inc (US), and Grab (Singapore) are the leading providers of ride sharing in the global market.
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Ride Sharing Market, by Distance: Short Distance to Account for the Dominant Share by 2026
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Increase in Urbanization and Internet and Smartphone Penetration
Increase in Urbanization
Increase in Usage of Smartphones and Growing Internet Penetration
Increase in Costs Associated with Vehicle Ownership
Varying Transport Policies of Different Countries and Resistance from Traditional Transport Services
New Business Models to Cover Losses in Ride Sharing Business
Food & Freight Delivery
Emergence of Autonomous Ride Sharing
COVID-19 Impact on Profitability & Sustainability of Transport Network Companies
Ride Sharing Market: An Ecosystem
Porter's Five Forces Analysis
Supply Chain Analysis
Ride Sharing Market Scenario
Low Impact Scenario
High Impact Scenario
Impact of Vehicle Automation on Ride Hailing
Impact of Automation L2 on Ride Hailing
Impact of Automation L3 on Ride Hailing
Impact of Automation L4/L5 on Ride Hailing
Autonomous Vehicles and Vehicle Connectivity
Asia-Pacific to Lead the Global Ride Sharing Market