Volkswagen AG Investing In Gett Ride-Hailing App

by Admin on May 26, 2016

Volkswagen AG is investing $300 million in the ride-hailing application Gett which looks to expand its current operations in Europe and New York City. Currently operating in over 60 cities worldwide with a primary focus in Europe, Gett competes directly with other ride-hailing apps such as Uber and Lyft which have greater prominence in the North American market. Gett is currently only available in New York City on the North American continent.

VW Gett

Automakers entering the ride-hailing service market is nothing new in 2016, in January General Motors Company sunk half a billion dollars into Lyft. Volkswagen’s entry into the same market signals the increased momentum in ride-hailing demand and expected growth. The Tel-Aviv based Gett had revenue grow 300% in the year 2015 and it’s revenue is anticipated to reach $500 million globally at some point in 2016.

Non-ownership vehicle transportation alternatives, whether it be ride-hailing apps or car-sharing services, offer a cheaper option when compared to financing/leasing a vehicle plus the costs of operating and maintaining. Ride-hailing services have also attributed success to their competitive pricing points in relation to traditional taxis in many cases. With the cost of new vehicles on the rise, alternatives that offer a similar level of practicality and convenience at a more competitive price point for the consumer are becoming increasingly popular, especially in dense urban settings where cost of vehicle ownership can be magnified by factors like parking and fuel expenses.  

It would not be surprising to see more large automakers soon enter the ride-hailing service market like VW and GM have done this year. As digital presences of all forms becomes more valuable to auto manufacturers, non-ownership vehicle alternatives is a natural place for them to strategically invest and hedge their customer base simultaneously.

Cameron Wallace
Account Manager

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