The Competition. Reuters/Jayanta Dey

Uber just cut its rates in one of the world's cheapest transportation markets.

Uber may be reeling from bad press in the United States, its biggest market, but this morning it made the front pages of newspapers in India, one of its fastest-growing markets outside the U.S., for a different reason.

In a country that already enjoys some of the lowest transportation costs in the world—the minimum fare for a taxi in Mumbai is 21 rupees, or 34 U.S. cents—Uber just cut its rates even further. The company’s new India-only discount service, called UberGo, offers hatchbacks at a base rate of 40 rupees ($0.65) and 12 rupees for every kilometer. The minimum fare is 80 rupees ($1.29).

Uber claims its pricing makes its cabs cheaper than Mumbai’s black-and-yellow street taxis. (We've been unable to confirm this; UberGo cabs have been unavailable in Mumbai all three times we checked since the service went live this morning.) In smaller cities the base fare is 30 rupees, cheap enough to compete with autorickshaws.

UberGo is a response to Ola Mini, a cut-rate service from India’s Ola, the incumbent taxi app. Ola Mini itself was a response to UberX, the American company’s cheaper service for global markets (which is also available in India). In essence, Uber is using its vast war chest to destroy its rival in India—while also taking on autorickshaws and taxis—the same way it is attempting to do so in the United States. Ola recently raised $210 million in funding from Japan’s Softbank, and is valued at some $1 billion.

Demand for transportation uniformly outstrips supply in Indian cities, and UberGo will be welcome news to some Indians, who are accustomed to waiting at the curb, being routinely turned away—or gouged—by drivers, and often have to haggle to get anywhere for a decent price.

But for the country’s millions of taxi and autorickshaw drivers, who are already facing rising diesel and gas prices, Uber’s latest roll out is just going to make life more difficult.

This piece originally appeared on Quartz, an Atlantic partner site.

More from Quartz:

Google Came Up With a Formula For Deciding Who Gets Promoted—Here’s What Happened

All Aboard the UK’s First Poop Bus

Why Your Uber Driver Hates Uber

About the Author

Most Popular

  1. photo: Chris Burden's "Urban Light," installed at the Los Angeles Contemporary Museum of Art, features several of L.A.'s historic streetlight styles.
    Design

    The Future of the Streetlight Might Be in the Past

    A new competition from the L.A. mayor’s office invites designers to reimagine the rich history of civic illumination and create next-generation streetlights.

  2. Maps

    The Three Personalities of America, Mapped

    People in different regions of the U.S. have measurably different psychological profiles.

  3. Life

    Talent May Be Shifting Away From Superstar Cities

    According to a new analysis, places away from the coasts in the Sunbelt and West are pulling ahead when it comes to attracting talented workers.

  4. photo: A stylish new funeral parlor called Exit Here in London.
    Design

    Death Be Not Dull

    U.K. restaurateur Oliver Peyton’s newest project, a style-forward funeral home called Exit Here, aims to shake up a very traditional industry.

  5. photo: A Starship Technologies commercial delivery robot navigates a sidewalk.
    POV

    My Fight With a Sidewalk Robot

    A life-threatening encounter with AI technology convinced me that the needs of people with disabilities need to be engineered into our autonomous future.

×