Association “Yandex.Taxi” by Uber and other companies “new monster”?


MOSCOW, July 13. /Offset. TASS Anna Dementyeva, Anna Toporova, Yekaterina Kazachenko/. An international technology company Uber and the Russian IT giant Yandex, which owns the service “Yandex.Taxi,” announced the largest transaction in the market for online aggregation – creation of a joint venture. To experts interviewed by TASS said how the merger will affect Russian taxi market.

For Uber, represented in 76 countries around the world, this is the first such Association with a local player, told TASS Director of communications of the company in Russia and CIS Irina Gushchina. However, she stressed that the deal should not be compared with the acquisitions of Didi in China business Uber. There share Uber made up only 17.5% without management rights business.

“This is the first time we combine business in any country, and continue to work together to manage the business, to increase it. This is the first such example,” said Gushchina on the merger’s terms of service.

The deal on the establishment of a new company has been approved by the boards of Directors of Uber and “Yandex”. It is expected to be closed in the IV quarter of 2017 Uber will invest in joint venture of $225 million, “Yandex” – $100 million the company’s Total value is estimated at $3,725 billion Expected at the time of closing of 59.3% of the company will belong to “Yandex”, 36,6% – Uber, and 4.1% of employees. In addition, “Yandex” does not exclude IPO (IPO) of the new company.

“The situation around the merger of the two largest cab aggregators operating in Russia, seems like “suddenly”, but if you look at it, to assess the benefits, which are both brands following the merger, the question arises “why are these guys not done this already yesterday?!”, – commented on the deal, Director of the Russian Association of electronic communications Sergey Plugotarenko.

Will create a deal “the new monster”

The head of the Federal Antimonopoly service (FAS) Igor Artemyev has said that the deal could pose a threat to competition in the market for online taxi aggregators.

“We should not fear the emergence of a new “monster”, it will not absorb all the direction, on the contrary, give an impetus to its development and the final, irrevocable digitalization of this direction”, – did not agree with him Plugotarenko.

In a taxi “Maxim”, one of the largest regional players in Russia, believe that the monopoly on the taxi market there, competition will continue, just with fewer big brands. “We must not forget that in every city there are dozens of taxi firms, among which there are those who take very strong positions. They are also competitors,” said the company.

However, the General Director of the Moscow “New Transport company” (brand “New Yellow Taxi”) Felix Margaryan noted that after the transaction, competitors have such a major player in the taxi market in Moscow remains. “Moreover, it is a Foundation for expanding the international market. By merging with a foreign company “Yandex.Taxi” gets a database and machinery abroad, and Uber – cars and orders in the vast territory of Russia”, – he stressed.

Market share

“Yandex” and Uber will bring together businesses online traffic in Russia and five more countries – Armenia, Azerbaijan, Belarus, Georgia and Kazakhstan. Players appreciate a share of the joint company in the Russian market of passenger transportation in the cities of presence of 5-6%. According to VTB Capital Research, legal taxi market in 2016 was estimated at 501 billion rubles., and “gray” – 116 bn in 2015.

Uber also estimated the proportion combined with the “Yandex.Taxi” company in the Russian market of 5-6%.

The merger, the new company will be second in the number of online orders in Russia after the Fasten, which is consolidated in 2017, two leading taxi service – “Saturn” and Rutaxi. Among the most well-known brands Fasten: “Saturn”, RedTaxi, “Lucky”, Rutaxi, “Leader”, Fasten.

At the same time in Moscow and St.-Petersburg the new company Uber, and “Yandex” will prevail in the market aggregators, says Director of corporate relations Fasten Alexander Kostikov. He stressed that the deal “Yandex” and Uber confirms the trend towards unification in the market.

The monthly volume transport of the combined company is expected to average about 35 million visits per month, said the current CEO of “Yandex.Taxi” Tigran khudaverdyan, who will lead a joint project with Uber. According to the June total with Uber, the cost of travel “Yandex.Taxi” a month is 7.9 billion rubles, said khudaverdyan.

What will win “Yandex” and Uber

“Yandex” has announced that the new company will use the technology and knowledge of “Yandex” in the field of mapping and navigation services and search engines, as well as global experience Uber in the market of online services for the ordering of transport services, which “will allow to create more dynamic and sustainable business that meets the needs of users and drivers, and helps the development of transport infrastructure of cities and regions”.

The Application “Yandex.Taxi” Uber after the closing of the transaction for users will remain separate. At the same time, the taxis and the drivers will switch to a single technology platform. This solution should allow to increase the amount available to carry out the orders of machines, reduce the time of their filing, to reduce idle run, to improve the reliability and availability of the service overall, I believe in the company.

This agreement proves once again that Russian technology can not only speak on an equal footing with world leaders, but to surpass them in quality, I’m sure the President Moscow Trading-industrial chamber on development of taxi transportations Bogdan Konoshenko. “The fact that the terms of the transaction included a roaming agreement with about the possibility of ordering Uber cars from the app “Yandex.Taxi” around the world, shows that the company was able to build a competitive and efficient technological platform, that are ready to pay dearly”, he stressed.

For customers nothing will change

Uber has stated that it is not going to change the tariff policy after the closing of the business combination with “Yandex.Taxi”. Moreover, the companies expect that both apps taxi will continue its work.

“No radical changes of tariffs, associated with the merger, we do not expect, neither now nor in the future”, – promised not to change his principles in “Yandex”.

As reported by TASS on condition of anonymity, a source in the transport market, the main advantage of creating a new company is a consolidation of budgets, which will allow you to activate the promotion. As for tariffs, the Agency assumes that initially can be expected to reduce them, therefore, the combined company will attempt to attract those consumers who have not used any of the services. “Due to the unified budget, they could make a cheaper rate, but not to cut benefits for drivers,” he said.

While the Agency does not exclude that in the future when the company will significantly increase market share, it will be able to dictate terms and then have to raise the rate.

“It is hoped that will increase the tariffs for end-users because the competition between the two giants in this market forced them to “fight” for passengers, including due to low tariffs” – said, in turn, Plugotarenko.

Chairman of the Moscow Trade-industrial chamber on development of taxi transportations Bogdan Konoshenko said that after the enterprises do not expect changes in tariff policy. “In such a highly liquid market, as taxi transport, any “crackdown” immediately leads to a transition of drivers and passengers to competitors. I think they will continue to move with the market and accurately to develop the services so as not to scare off users and keep the partner base,” he said.

Relations with the authorities

Russian Uber have repeatedly had problems with the authorities. For example, in early July, the Deputy mayor of Moscow Maxim Liksutov reported that Uber had failed to communicate the drivers in the online mode, which is required by the relevant resolution of the Moscow government, which came into force from April this year. “Uber us data reports, but not in the format you need. It is not possible to react quickly in emergency situations,” he said.

A representative of Uber, in turn, noted that the company provides a significant amount of data in the framework of bilateral agreements with the government of Moscow. She added that specific aspects of the work with the authorities to discuss yet, but assured that the deal with Yandex is not related to the requirements of regulatory bodies or government. “The rationale behind this transaction solely in economic efficiency, great opportunities for business development,” she said.

The owners of taxi fleets is also unhappy with the appearance on the market of online aggregators. Taxi drivers have repeatedly appealed to the authorities with a request to check the aggregators to determine rates below market. In their view, legitimate taxi drivers are unable to transport at such low rates. Carriers also complain that they have to operate at a loss.

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