In a recent study about Uber, I got to know that Uber has great potential to be very successful and it is obvious other rivals have noticed this too. Mercedes-Benz wanted a way to hinder the success of Uber by entering its market and earning large profits of their own. Daimler, the mother company, plans on doing this by launching autonomous vehicles into the market. They plan on doing this by making autonomous Mercedes limousines to compete with Uber. They want to target a niche market of customers who want an elite service while paying comparatively lower prices. Based on the article, “Mercedes wants to go directly after Uber“, I found out that the market for vehicles with autonomous features is expected to go up to 13 percent by 2025, leading to a market worth nearly $42 billion. This is a huge market and many companies will try to enter it, but the problem is that the autonomous vehicles will not be ready until 2025, hence they cannot enter this market with autonomous cars till then.
By introducing autonomous vehicles into the market, the cabs can be 35 percent cheaper than conventional cabs as now they do not have to pay the drivers a salary and there will be no wastage of time as everything will be automated. this could also be a problem because in case there are some issues with the software of the autonomous vehicles, the cab services will have to stop temporarily.
Uber has an advantage as they are already in the market and they have earned a good market share as well. Along with that Uber has very low operation costs as they are earning a fixed commission every time a customer uses the application and every time the driver uses it. By 2025 Uber would have already increased their market share drastically, which will make it difficult for the rivals to compete.
Mercedes will have to work hard to get the autonomous vehicles rolling out of the factories soon if they want to give Uber any competition. Till then Uber has to keep going strong in its market and stay on top!
