Ride-hailing app Bolt from Estonia has launched its service in Bangkok, the latest newcomer in a very competitive market still reeling from the pandemic.
The move comes after Bolt raised €100 million (3.7 billion baht) in May this year, bringing total funds raised to €300 million.
According to online statistics portal Statista, Thailand's revenue in the ride-hailing and taxi segments is projected to reach US$1.17 billion (36.8 billion baht) this year.
Revenue is expected to record a compound annual growth rate from 2020 to 2024 of 19.4%, resulting in a projected market volume of $2.4 billion by 2024.
User penetration is projected at 16.7% in 2020 and is expected to hit 18.4% by 2024.
Bolt operates in over 35 countries across Europe and Africa, with services ranging from ride-hailing to micro-mobility, with e-scooters and electric bikes as well as food and package delivery.
Bangkok is the first city in Bolt's Asean market.
The startup said more than 2,000 drivers in the capital stand ready to provide the service.
"We are always looking for new markets we believe could benefit from more alternatives when it comes to city transportation, both from the passengers' side and the drivers' point of view, and we think this is a good time for Thais to try Bolt service," Bolt said in an email reply to a Bangkok Post request for comment.
The startup indicated for a minimum of six months, it commits to charging drivers no commission for using the platform and offers fares 20% lower than other competitors in the market.
Through its experience in European and African markets, Bolt said ride-hailing is not a winner-takes-all market.
"We put a big focus on drivers. They earn more than on other platforms because of our lower commission," the startup said.
Bolt said the demand for urban transport is growing in Bangkok as the city gradually comes out of the lockdown.
"We believe the city will benefit from more choice in transport options. We are also providing additional earning opportunities for drivers at this challenging time," said Bolt.
Bolt is a free mobile application that connects drivers and passengers. In order to become a Bolt driver, a person has to have a car and all necessary licences required by local regulations.
Payment from passengers is made in cash.
Weeradej Panichwisai, senior research manager of IT research firm IDC Thailand, said the expansion of the European startup in Thailand during the pandemic suggests the country has strong market potential as cars are the major means of transport for Thais.
If this startup dedicates itself to investing and building its brand with attractive service prices, it should be able to sail through one year in this market, he said.
"If it only wants to test the market, it may have to exit within one month," said Mr Weeradej.
As Bolt recently raised more funds from investors, it may now need to expand and scale, he said.
Meanwhile, the market leader Grab announced it would reduce incentive payment for GrabFood drivers in 27 provinces, excluding Bangkok, Nonthaburi and Pathum Thani, to maintain its cash flow.
More details will be provided soon, according to the ride-hailing and food delivery giant.
However, the base fare for drivers is not changing.
Grab said it would provide extra benefits to its driver partners in the provinces, including insurance coverage, financial service as well as discounts in using the services of shops and restaurants.
