The ride-hailing market fell by 59% in the first half of 2020 as a result of the Covid-19 pandemic, according to ABI Research.
The drop in the ride-hailing market follows growth of 14% in 2019.
James Hodgson, principal analyst at ABI Research, said: “While it might have been expected that growing consumer concerns around shared spaces would push them back into privately owned cars, this has done little to offset the collapse in new vehicle sales.
With the near-total disruption of the bricks and mortar retail channel for new vehicles further compounded by a worsening macroeconomic situation it’s a bleak outlook going into 2021.”
Meanwhile, the ride-hailing market has effectively come to a standstill, with numerous platforms competing for a larger share of an imploding market.
After a brief conceding ground to local competitors, Uber has begun to consolidate its position global position, retaining a market share of around 70% in the US and Western Europe, and over 85% in MEA, made possible by the 2019 Careem acquisition.
Similarly, Didi and Grab have maintained a commanding market position in their key markets, with Didi having well over 90% of the Chinese market, and Grab holding 63.5% of the Indonesian market, and almost 75% percent of the Vietnamese market.
Nevertheless, despite their dominance of the ride-hailing markets in key regions, all Hodgson said these platforms have had to pivot aggressively towards non-ride hailing use-cases, with food and grocery delivery providing some much-needed revenue.
Didi launched delivery services in 21 Chinese cities, while Uber reinforced their existing food delivery services via the acquisition of Postmates in July 2020.
Food delivery services now account for over half of Grab’s 2020 revenues, with Grab also expanding their GrabMart grocery delivery service from two countries to eight of the countries in which they operate.
This pivot toward delivery services has helped ride-hailing platforms maintain driver engagement with their mobility platforms.
“In the longer term, ride-hailing platforms must accommodate consumer and regulator concerns over the integrity of shared public spaces in order to return the core ride-hailing use-case to growth,” Hodgson advises.