The Rise Of Self-Drive Car Rental Services In India; What Lies Ahead

Digital India

The Rise Of Self-Drive Car Rental Services In India; What Lies Ahead

Few people would argue that the time for self-drive car rental in India has come.  Just two short years ago, the industry didn’t exist.  It was relegated to a few small, local mom and pop type operators who would occasionally hire out a vehicle to a friend of the family or some other known person who wanted to drive themself.  There was simply no organization in the market. No method to the madness.  From a customer standpoint, it was an incredibly frustrating process since there was zero transparency at every step of the way.

Perhaps most disheartening (and frightening) was that the vast majority of these local operators didn’t even have the requisite insurance cover or proper regulatory documentation.  In the event of an accident, there was little assurance that the damage would actually be covered, meaning the customer would have to shell out from his pocket. In the event of a third-party incident, there was even more doubt; certainly a tenuous position to say the least.

Now, fast-forwarding to 2015, look around and one will find no fewer than 8 organized self-drive rental car companies pan India.  One might say that finally, tech innovation has hit this long maligned space.  As a result, customers now have a seamless overall experience, ranging from booking to pickup, all the way through to dropoff.  Some companies like Zoomcar have gone so far as to automate the entire pickup/dropoff process all through the convenience of a mobile app.  Surely, the customer experience has improved exponentially from the days of the mom and pop operators!

While we should all praise these advancements across the board, now is collectively the right time to take a step back and think about the fundamental safety of the driver, the passengers, and the other vehicles on the road as a result of this self-drive explosion.

Safety has not always been treated with the highest degree of importance on the Indian roads.  Just look around and see the frequency (or infrequency) of ticketing done for simple offenses such as seatbelt violations, running a red light, or even illegal u-turning.

Forget about overspeeding!  These issues are certainly quite prevalent with individuals who own their vehicle.  With that in mind, it’s not difficult to imagine that these issues could be even more pervasive when someone is driving a rental vehicle.   Given this fact, it’s critical that self-drive companies have robust, comprehensive policies in place that protect both the customer, third parties, and the vehicle itself.  After all, the vehicle should end up lasting between 2-3 years!

While it may seem like a daunting challenge to put systems and processes in place to help curb rash driving and promote safer motoring, technology is once again right there to help provide a solution.  Many self-drive companies have implemented a speeding alert system through a sophisticated integration with the vehicle’s 24×7 GPS tracking system.  This in-car “black box” helps the company monitor the speeds of its vehicles in real-time.  As a result, penalties can be imposed on customers exceeding certain speed limits (sometimes the rupee fines can be quite high).  This strong disincentive actually goes a long way in encouraging smarter, safer driving.

With the recent advent of novel bluetooth based hardware tied to the OBD (on board diagnostics) port, companies can actually monitor the driver performance by assessing his braking, steering, and fuel efficiency, to name just a few.  This helps companies actually develop objective criteria by which they can rate drivers.  This intelligence can then be pushed back to the driver to make the person drive safer the next time.  In fact, many companies like Zoomcar* have already taken it one step further and provide real-time driver performance feedback. Suffice to say, this helps alert the driver to bad tendencies so they can course correct quickly, thereby helping them avoid accidents and other potential unscheduled maintenance events.  These systems no doubt make the self-drive industry far safer than otherwise imagined by outside observers.

Over and above these technology developments, self-drive companies are also working very closely with OEMs and local dealers to service their fleet of cars at much more frequent service intervals than the standard whiteboard vehicle.  In many instances, this means servicing the car every 5,000 kms once the car is more than one year old.  This is approximately 3 times more frequent than for a retail whiteboard.  This more robust servicing level ensures that the car will run at a high performance even when it’s taken into different driving environments.  Considering the fact that individuals have different driving styles, this additional servicing provides customers with a peace of mind knowing that the car is consistently observed and worked on by vehicle maintenance professionals.

Despite these proactive technology and operations measures taken by many of these new age self-drive companies, the reality is that both the state and central governments lag behind greatly in doing their respective part.  This is where the next great leap forward within road safety will hopefully come from in the months and years ahead.

Unlike in many western countries, India still has a very draconian, highly byzantine structure of regional transport offices and state transport authorities on a state-by-state basis.   There’s seldom any uniformity and continuity of policies across these state organizations.  In reality, many of these states choose to enforce seemingly arbitrary interpretations of the central motor vehicles law.  One current shortcoming within the public sector relates to information sharing around individual driver’s licenses.

For a self-drive rental company in Bangalore, it’s really impossible to validate the driving record of someone with a license from say, West Bengal.  That particular driver may be an at risk individual since he may have gotten into 3-4 accidents in the past 2 years.  This type of information is an obvious flag for a self-drive company.  Rationale might dictate that this individual should be charged a higher price to rent a vehicle because of his recent driving history. Currently, this data is not available for self-drive companies and therefore, there’s no way to truly differentiate between first-time customers who book with these companies.

This is merely one example of a way where more comprehensive information sharing across state governments can dramatically improve efficiency within the self-drive car rental system in India.  The new Motor Vehicles Act slated to be released next year is expected to help address many of these informational sharing concerns and hopefully can also help with enforcement of many current road safety policies.Greg

While the government may be a laggard in providing an inter-linked driver information platform for self-drive companies to leverage, these startups are nonetheless proactively devising solutions to improve road safety across Indian cities.  This type of relentless optimism isn’t likely to change anytime soon.

[*About the author: Greg Moran is the cofounder of Zoomcar.]

Comments (5)

  1. ankush

    Yeah! its true , I have used Zoomcar on several occasions and they always deduct some amount from the deposit on some bogus claim.

    Ozoneride provides way better service and doesn’t cheat its clients. They are cheaper also.
    GOooooooooooo Ozoneride !!

  2. ankush

    Yeah! its true , I have used zoomcar on several occasions and they always deduct some amount from the deposit on some bogus claim.

    Ozoneride provides way better service and doesn’t cheat its clients. They are cheaper also.
    GOooooooooooo Ozoneride !!

  3. Vaishakh

    True Shivam.

    Greg. I am not sure if you guys are handling it right from the valley, but if you visit Bangalore and check the car conditions, you will be disappointed.

    I took a zoomcar for rent last week and these were the issues with the car.

    – Tyre pressure was 3 (which is like no pressure at all)
    – Car Dicky was not closing. (had to hit hard the 4th time for it to close)
    – Dents on cars everywhere. (although entire deposit is cut if the driver has an accident)
    – Dirty interiors. (although we pay enough rent, the car was not cleaned at all. It was stinking)

    I was thoroughly disappointed this time. I hope you guys don’t fade out in quality just like other companies. If you dont maintain the quality then better luck elsewhere. You guys need to understand that this is not only about convenience, cause our lives at stake when we drive such vehicles.


    Interesting article Greg. Surely, what Zoomcar and associated self-drive rental companies have achieved is commendable. Your blog/guest post talks a lot about centralisation. While this might hold true to certain extent in western nations, your wish list is a long way away from happening in India. Some points:
    1) Driving License Validation – Not sure how many self rental car companies (even in Western World) do this. Risk mitigation as always is a red herring for sectors such as this.
    2) On-time Driver feedback -There is a trade off between the capital put into these technologies (and associated monitoring costs for personnel and data tracking) and the resulting benefit for self drive companies. yes, it will be a niche thing and may be, may me it will act as a deterrent – but how cost effective will such a project be. In my view, India being a cost competitive market will not render this function to be active. It could however work in Luxury car rental.
    3) Another major issue that has been overlooked is the issues that one would face when these self-drive cars used inter-state. (a) Perception and issues with transport authorities (license, registration etc) and (b) pick-up and drop off inter state – and associated travel back to base location.

    In a nut shell, it is very hard for a new sector (that is also largely private and PE driven) such as yours to expect tapping into or benefitting or expecting matters from Govt regulation. For Ex: The Aadhar card could readily be used as a metric that could let service providers (such as yours) to create a database for risk mitigation. Would it happen from the Govt – most probably not. The private sector has to come up with something to bank upon and manage risk.

  5. Shivam Agarwal

    Nice article Greg. And indeed your (Zoomcar) contribution is worthy contributor to improving self drive rent facility in India. And I completely agree that safety should be of utmost priority. To ensure that, you can use technology, app, GPS, but nothing holds any significance if proper checks are not done over vehicle before handing it over to customer. This involves maintaining and caring your vehicle, your asset, your child like a father. I m sorry to say but this hasn’t been true with Zoomcar offlate. Car conditions have degraded with no1 to look after properly, service is poor, Customer care does not answer call, pick up centers fool customers. Sorry to list down so much but thats a hard reality. I have used zoomcar thrice and this is visible over period of time. Your contribution has been immense but as you rightly pointed out, this is time to improve and innovate else with time all the hard work done will fade away.

Leave your thought here