The global ride-hailing service market is projected to expand from US$ 48,922.78 million in 2021 to US$ 98,745.11 million by 2028, reflecting a compound annual growth rate (CAGR) of 10.6% during the period from 2021 to 2028.
This market is categorized based on various factors including service type, vehicle type, location, end user, and geographical region. In terms of service type, the market is divided into e-hailing, car sharing, car rental, and station-based mobility. The increasing use of smartphones and enhanced internet connectivity is significantly boosting the demand for e-hailing services worldwide.
When considering vehicle types, the market is segmented into two-wheelers, three-wheelers, four-wheelers, and others. Technological advancements in digital payment systems, safety features, and overall rider and driver comfort have contributed to the growth of the four-wheeler segment within the ride-hailing market. Geographically, the market is divided into urban and rural locations. The rapid increase in internet access and the growing acceptance of ride-hailing services have spurred growth in urban areas.
From the perspective of end users, the market is categorized into institutional and personal users. The rise in daily commuting in urban settings, along with a growing inclination to save fuel by sharing rides with colleagues, is expected to drive the personal ride-hailing segment. Geographically, the market is primarily segmented into North America, Europe, Asia-Pacific, the Middle East and Africa, and South and Central America. The increasing adoption of ride-hailing services in countries like the UK, Germany, and Switzerland is propelling market growth in Europe.
Key players in the ride-hailing service ecosystem include technology solution providers, ride-hailing service operators, and end users. Technology solution providers encompass manufacturers of connected devices and software developers. The rise in the number of technology solution providers is crucial for advancing digitization within the ride-hailing sector. Post-COVID, the demand for ride-hailing services is anticipated to rise due to the growing trend of on-demand transportation, job creation, and a decline in car ownership among younger generations. Furthermore, innovations in connected and autonomous vehicles aimed at reducing CO2 emissions, along with a significant increase in sales of such vehicles for ride-hailing purposes, are expected to drive global market growth.
Ride-hailing service providers rely on technology solution providers for their operations. As technological advancements continue to evolve within the ride-hailing sector, the demand for these services is on the rise. However, despite favorable global growth conditions and high demand from ride-hailing companies, the COVID-19 pandemic had a minimal impact on the growth rate of the ride-hailing service market in 2020. The pandemic led to a decline in the demand for ride-hailing services, but with the reopening of various markets, vaccination rollouts, and government initiatives to stimulate economic recovery, the future demand for ride-hailing services is expected to grow steadily. Notable players in the ride-hailing market include Daimler AG, ANI Technologies Pvt. Ltd., DiDi Global Inc., Uber Technologies Inc., Gett, and Delphi Technologies Plc, among others.
Impact of COVID-19 on the Ride-Hailing Service Market
The COVID-19 pandemic has significantly affected the global economy, with countries such as the United States, Spain, Italy, France, Germany, the UK, Russia, Turkey, Brazil, Iran, and China being among the hardest hit. The pandemic's repercussions on the economy are expected to persist for an extended period. Industries such as electronics, semiconductors, and automotive have faced substantial challenges due to the outbreak. Consequently, the growth of the ride-hailing service market has been hindered by a notable decline in these sectors.
Factory shutdowns, travel restrictions, and border closures have disrupted the operations of numerous businesses globally. Additionally, social distancing measures mandated by governments have compelled ride-hailing service providers to limit their operations. A global survey conducted by Cars.com in March 2020 revealed that over 40% of respondents had stopped using ridesharing services to mitigate their risk of contracting the virus. More than 90% of participants reported increased usage of personal vehicles, with 20% considering purchasing new cars. The downturn in the ride-hailing industry led to a significant revenue drop, with Lyft reporting a 36% year-over-year decline. Moreover, ride-share fares decreased by 6% month-over-month in 2020, according to Canaccord Genuity's price tracker.
However, as lockdowns were lifted and vaccination efforts progressed, manufacturing and construction sectors resumed operations, and travel restrictions eased, the ride-hailing industry began to recover. Consequently, 2021 saw a notable resurgence in demand for ride-hailing services.
The overall size of the ride-hailing service market has been determined through a combination of primary and secondary research methods. Extensive secondary research was conducted using both internal and external sources to gather qualitative and quantitative data related to the market. This process also aimed to provide an overview and forecast for the ride-hailing service market across all segments. Primary interviews with industry participants and experts were conducted to validate the data and gain deeper insights. Participants included industry professionals such as VPs, business development managers, market intelligence managers, and national sales managers, as well as external consultants specializing in the ride-hailing service market. Key players in the market include ANI Technologies Pvt. Ltd., Daimler AG, Delphi Technologies Plc, DiDi Global Inc., Gett, Grab Holdings Inc., Lyft, Inc., TUKTUK RIDE, Uber Technologies Inc., and zTrip.