Taxi Market in Russia Expected to Grow to $11bn in 2019

The Russian government’s Analytical Center expects the country’s taxi market to grow by 5.6% to 709 billion rubles ($11 billion) in 2019, RBC reports.

The study also estimates the illegal taxi market in Russia grew by 6.3% compared to 2018, to about 100 billion rubles ($1.56 billion). In some regions up to 50% of all paid rides are delivered by unlicensed drivers. Obtaining a licence to drive a taxi is not mandatory, but the police are increasingly fining drivers without licenses.

Competition in the digital transportation solutions market toughened this year as Russia’s largest bank, Sberbank, recently set up a joint venture with Yandex’s largest rival Yandex.Taxi is still a market leader and is reportedly preparing for an IPO and strengthening its foodtech services.

But the sharp growth phase that was provoked by the entry of taxi aggregators through lower prices and more passengers is waning, the study warns. The growth pace of the market is seen declining from 8.6% in 2018 to 3.7%-4% next year, stabilizing in the longer term at about 2%, bneIntellinews wrote.

In 2019 taxi aggregators are seen taking about 60% of the taxi market, with Yandex.Taxi being the market leader with 27% share. Vezet, recently acquired by Yandex, takes another 12%. Maksim taxi accounts for 9%, Gett for 5% and 1% for Citimobil.

Representatives of Yandex.Taxi argued to RBC that the market will maintain faster growth than that estimated in the survey due to even deeper market penetration and legalization of unlicensed drivers.

Sberbank previously estimated that the value of the entire urban transportation market (taxi, carsharing, carpooling, etc) could reach RUB2 trillion by 2025, growing by an average of 15% from 748 billion seen in 2018.