• The startup says it's having trouble keeping pace with demand
  • It says new Micro service alone could surpass Uber in a month

Ola, India’s dominant ride-hailing service, is struggling to keep up with demand just weeks after launching an inexpensive compact car service called Micro to challenge Uber Technologies Inc.

The startup’s latest service went live across seven of India’s largest cities last month, including Bangalore, New Delhi and Mumbai, and has already become the largest in a portfolio of offerings encompassing Ola Mini, Ola Sedan, and three-wheeled Ola Auto.

“We are getting hundreds of thousands of requests everyday that we are not able to fulfill,” said Raghuvesh Sarup, Ola’s new head of categories and its chief marketing officer. Sarup said Ola now commands three-quarters of the overall ride-sharing market.

Offering rides starting from 6 rupees (9 U.S. cents) per kilometer, Micro is already experiencing demand that the Ola executive estimates at about half of Uber’s current total daily bookings. But the service is growing so fast that, in a month, Micro alone could surpass its U.S. rival’s per-day orders, he said.

Tit-for-Tat

Sarup wouldn’t say how the startup was deriving its estimates for Uber. The U.S. startup’s UberGo compact segment now features fares that start as low as 5 rupees a kilometer in some cities.

“We are excited about the progress we are making in India,” Ruchica Tomar, a spokeswoman for Uber in India, said in responses to questions about Ola’s claims.

Ola, backed by Japan’s SoftBank Group Corp., DST Global and Tiger Global Management LLC, now has the upper hand in the battle for India’s emerging ride-sharing industry, a rivalry that most recently spilled over into motorcycles. Ola, which was said to have been valued at $5 billion in its last funding round, is trying to fend off an aggressively expanding Uber.

Numbers released by WhichApp, which tracks apps on 90,000 Android users in India, show India’s third-most valuable venture-backed startup was installed more than twice as many times as Uber in 2015.

“Ours is a ‘Made for India’ solution that is intended to get middle-class Indians to try out and get hooked to our service,” said Sarup. “This country needs hyperlocal, India-specific innovations.”

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