Uber links with Tata to expand in India

The Indian conglomerate Tata is investing up to $100m (£64m) in Uber as part of a new “strategic partnership” with the taxi-hailing app, just as the US-based tech group is looking to expand its operations on the subcontinent.

Uber, whose mobile phone application links passengers with a list of local drivers, currently operates in 18 Indian cities, making the country its second biggest market behind the US in terms of locations. As well as car services it launched an autorickshaw hailing service in Delhi earlier this year.

It is looking to average more than one million rides a day in India within nine months, but it faces strong competition from a number of local rivals including Ola, which is backed by the Japanese tech giant Softbank as well as Tata’s own chairman emeritus, Ratan Tata. Ola currently averages 750,000 rides a day against Uber’s 200,000.

The expansion of taxi-hailing apps such as Uber and Ola in India has seen mini boom in car sales in the country, where many would-be drivers need to buy their own cars. Commentators noted that this could provide cross-selling opportunities for Tata, which owns everything from hotels to steelworks, including Tetley tea and Jaguar Land Rover in the UK.

As well as its Tata Motors cars division, its Tata Capital also provides car financing.

The Chinese search giant Baidu invested in Uber at the end of last year and agreed to integrate the taxi-hailing service with its smartphone map app, taking on local rivals such as the Alibaba-backed Didi Dache.