Senmiao Technology Ltd (NASDAQ: AIHS) is a crucial player in the financial hub, which focuses on the online ride-hailing industry. However, due to a surge in COVID-19 cases, the company witnessed a drop in completed orders.
The surge in COVID cases impacted volume: Senmiao announced its operating metric for June 2021 for its proprietary online ride-hailing platform. As per Senmiaa Technology, completed orders for June 2021 (period under consideration) declined approximately 4% due to a surge in COVID-19 cases. The decline in completed orders is primarily attributed to travel restrictions due to COVID cases. As per the company, the number of drivers completing rides in June 2021 increased by 2% compared to May 2021.
Since the launch of the online-ride hailing platform in October 2020, approximately 10.5 million rides have been completed. The number of rides taken in June 2021 stood at 2.1 million rides. As per the management, the average monthly growth rate for completing the orders and active drivers during January to June 2021 period was approximately 29% and 28%, respectively.
Growing ride-hailing market: During the pandemic ride-hailing market was poorly hit, primarily due to restrictions imposed by the local government. However, as per various industry reports, the ride-hailing market valued at $113 billion in 2020 and is expected to reach $230 billion by 2026. The growth will be primarily driven by the increasing usage of the platform across developing countries, such as China, Vietnam, India, etc. In addition, increased traction in the developed market of Europe and the United States will also support the growth. The higher demand in developed and developing countries has led the company to operate in the space to enhance their operations, retain their respective market share in a competitive market, and offer the best services to their guests in a cost-effective manner.