Uber is making waves in India’s burgeoning B2B logistics market by partnering with a government-backed nonprofit. Their aim? To challenge the stronghold of Amazon and Walmart-backed Flipkart in digital commerce across South Asia.
In an exciting announcement, Uber revealed plans to launch its B2B logistics service through the Open Network for Digital Commerce (ONDC). This venture will allow businesses on the network to access Uber’s vast network of 1.4 million drivers for on-demand logistics. Initially focusing on food deliveries, the service is set to expand into e-commerce, grocery, pharmacy, and healthcare logistics.
With this move, Uber will join other logistics players on ONDC, such as Shiprocket, Shadowfax, Porter, and Loadshare. The service will mirror Uber Direct from the U.S., though exclusively for ONDC network businesses.
Uber’s entry into B2B logistics follows its recent expansion in consumer logistics in India, introducing Courier XL in Delhi and Mumbai. This service allows users to deliver large items up to 1,653 pounds using three- and four-wheeler carriers. Uber has also been offering a two-wheeler courier service for standard package deliveries.
Entering the logistics sector is strategic for Uber as India’s logistics market is projected to soar 49%, reaching 13.4 trillion Indian rupees ($157 billion) by 2028, up from 9 trillion rupees ($105 billion) in 2023. This move offers Uber a robust business opportunity in India, especially after a 41.1% increase in their operating revenue in the country last year.
Despite facing intensifying competition from local ride-hailing services like Rapido and Namma Yatri, Uber’s diversification into logistics aims to solidify India as a key market.
In addition to logistics, Uber has introduced metro ticketing on its app, powered by ONDC. This feature, initially available for the Delhi Metro, is part of a broader collaboration with the Indian government following a memorandum of understanding signed during CEO Dara Khosrowshahi’s visit to India. Metro ticketing will expand to three more cities this year.
The ONDC, launched in 2021, was intended to boost digital commerce and support small retailers in going online. However, it has faced challenges in gaining traction, partly due to leadership changes and declining retail orders.
According to Vibhor Jain, acting CEO and COO at ONDC, “Uber’s initial enablement of metro ticketing and logistics unlocks new possibilities — from seamless multimodal journeys to unifying a fragmented logistics ecosystem.” This partnership sets the stage for future innovations on the network, enhancing value for users, partners, and the mobility sector.
