Careem launched a cheaper service in Abu Dhabi on Tuesday in an effort to tap into the “significant” potential offered by the market, according to the operator.
The ride sharing company will operate about 300 "economy cars" in the capital which will be available for hire for a minimum charge of Dh19 – compared to the minimum charge of Dh12 for a standard taxi.
The economy fleet will be made up of three models: Lexus ES350s, which the operator currently uses in its more luxurious ‘limo’ service, seven-seater Toyota Previas and Chevrolet Impalas. Journeys will be charged at D2.35 per kilometre.
Bassel Al Nahlaoui, managing director for the Gulf Region of Careem, said the introduction of the economy fleet was driven by requests from customers to expand its services in Abu Dhabi.
“There is a supply that exists already in the city. It is just a matter of how many we can onboard on to Careem,” he said.
In addition to launching the new service, the company will reduce the price of its more luxurious so-called limo fleet, which will feature newer cars and higher rated captains, by more than 30 per cent from Tuesday. It was previously Dh4 a kilometre.
“You will feel like you are in a newer car [in the limo service],” said Mr Al Nahlaoui.
“And you should feel a better service from the captain – a big part of the Careem promise is the in ride experience, which is mainly driven by the captain.”
The news was announced in a joint press conference in Abu Dhabi with the Integrated Transport Centre.
Mohammed Al Qamzi, general manager of ITC, said Careem's economy service will compliment the taxi services already available in the capital.
“We are trying to give people choice. We see the demand for this kind of services worldwide,” said Mr Al Qamzi, adding that the department is also in talks with Uber about a return to the Abu Dhabi market.
“There are meetings between us and things are [progressing],” he said. Uber has been contacted for comment.
In addition to launching the economy fleet, Careem has also reduced its fees for the rest of its services in Abu Dhabi by around 30 per cent, he said – including for trips in Careem Kids, MAX and Careem Assist.
The company said it is also offering full and part-time opportunities to Emiratis and the children of Emirati mothers on the back of requests, said Mr Al Nahlaoui.
“This is how this all started. We went to the department and said we are getting requests from people who want to join us but are not part of the limo company. It is very exciting,” he said.
“The beauty of this is that you are creating employment opportunities for those Emiratis who are seeking employment. But also you are creating additional income for those who are seeking a part time [job],” said Mr Al Nahlaoui.
Emiratis will be allowed to use their personal vehicles in accordance with Integrated Transport Centre regulations.
“This is going to be the first time that we will allow local UAE nationals to participate in this,” said Mr Al Qamzi.
“We just need to make sure that these are the right people to represent Abu Dhabi.”
In February, the company said it had received regulatory approval to charge rates that will make the cost of journeys using its ride-sharing platform in the capital closer to what it is in Dubai.
The decision concluded what was a five-year period of uncertainty over the legal status of both Careem and its rival Uber in the emirate.
They both launched in 2013 but suspended their services in 2016 amid concerns from transport authorities over their pricing structures being in violation of regulations for private hire car, or limousine, companies.