Ride-hailing And Taxi Market Supported by Improved Road Infrastructure

According to a recent report by Grand View Research, Inc., the global ride-hailing and taxi market is projected to reach USD 432.16 billion by 2028, expanding at a compound annual growth rate (CAGR) of 11.7% between 2022 and 2028. This growth is largely driven by the expansion of major market players into new regions and a rising number of consumers opting for ride-hailing services due to their convenience and comfort. The increasing reluctance among consumers to bear the high costs associated with car ownership and maintenance, combined with growing urban traffic congestion and limited parking availability, is further propelling market expansion.

Urban migration continues to accelerate as rural populations move to cities and metropolitan areas, contributing to population density and increased demand for transportation. The proliferation of ride-hailing and taxi-booking apps, along with broader access to internet services and more affordable smartphones, is also fueling global market growth.

However, the COVID-19 pandemic caused a significant decline in ride-hailing and taxi usage due to lockdowns and government-imposed restrictions. With schools, colleges, and many offices shifting to online platforms and remote work, consumer travel sharply decreased, which in turn affected market revenue. Additionally, the pandemic spurred a shift in consumer preference toward private vehicles and two-wheelers, negatively impacting short-term market growth. Despite this setback, the market is expected to recover and grow steadily over the forecast period.

Among the different service types, the ride-hailing segment is expected to experience substantial growth, with a projected CAGR of 17% from 2022 to 2028. Expansion efforts by ride-hailing companies in regions such as Asia Pacific, Central and South America, and Africa are expected to contribute significantly to this growth. For example, Ola Cabs launched in Sunshine Coast, Australia, in August 2019 and has plans for further expansion in Australia and New Zealand. The popularity of ride-hailing is also bolstered by features such as digital payments, door-to-door service, customizable rider/driver options, and increased smartphone and internet usage.

In terms of distribution channels, the offline segment held the largest market share in 2021, accounting for 58.7% of global revenue. This dominance is attributed to the long-standing presence and widespread accessibility of offline services. A larger number of companies continue to offer offline services, contributing to the segment's leading position.

The Asia Pacific region led the global market in 2021, commanding over 55% of total market revenue. This dominance is largely due to the region’s vast population—which represents 60% of the global total, according to the United Nations Population Fund—combined with a high rate of urbanization and broad access to ride-hailing platforms. The expansion of local market players and growing consumer demand have also played a significant role in establishing this strong market presence.

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Ride-hailing and Taxi Market Report Highlights:

• Central and South America are expected to exhibit a strong growth rate, ranking second with a projected CAGR of 11.6% through the forecast period. Economic development, rapid urbanization, rising consumer demand, and the increasing cost of vehicle ownership and maintenance are driving market growth in the region.
• Taxi services accounted for over 75% of the market revenue in 2021. This dominance is attributed to the segment’s established presence, the strong positioning of key service providers, and broad service availability.
• Online distribution channels are forecasted to grow at a CAGR of 13.1% during the forecast period. The rise in digital adoption, particularly among younger consumers, and the convenience of online platforms are key factors behind this growth.

Leading Companies in the Ride-hailing and Taxi Market:

• Uber Technologies Inc.
• Lyft Inc.
• Didi Chuxing Technology Co.
• Ola Cabs
• Bolt Technology OÜ
• Grab Holdings Inc.
• Gett
• Yandex N.V.
• Cabify España S.L.U.
• Meituan Inc.

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