Blablacar Tackles Commute, Grows Ride-Share Challenge to Uber

(Bloomberg) -- Blablacar, the car-sharing application that lets drivers split the cost of long-distance trips with passengers, is expanding into short-distance routes by tending to daily commutes to work and back.

"Most people use Blablacar to go away for the weekend or head out on holidays," founder Frederic Mazzella said Tuesday in a press conference in Paris. "There's huge potential for daily ride-sharing to work and back, which so far hasn't materialized for lack of tools or habit."

The closely held French company has 40 million users according to Mazzella, with a quarter in France, and has expanded into 22 countries in a decade. It has so far avoided trading on Uber Technologies Inc.'s turf, with 9 out of every 10 Blablacar rides consisting of routes longer than 80 kilometers.

A new mobile application, called BlablaLines, will allow shorter distance car-sharing rides depending on user demand and chauffeur availability. 

BlablaLines will be commission free at first in order to grow the company's subscriber base, Mazzella said. "We want to drive usage up for now; we'll define monetization later."

Blablacar is edging closer to a crowded short-distance market, where Uber to Lyft have been fighting for passengers. The company is sticking to a different business model though -- it gets a commission on booked long-distance rides, but while drivers use it to share costs, they don't make a profit.

The app -- similar to Waze Inc.'s Rider carpool service -- will go up against Uber and IDvroom, launched by train operator SNCF. Uber Chief Executive Officer Travis Kalanick described car-pooling and the commute to work as the "next frontier" for the company a year ago at a conference in Brussels.

Uber has been busy battling French regulators over driver rights and whether it is a digital service or a transport company.

A test version of Blablacar's new app will be launched first on two popular commuter lines in Reims and Toulouse, and will be expanded from the fourth quarter to the rest of France. Electronic payment may be added later, with the first batch of users paying in cash, Mazzella said.

To contact the reporter on this story: Marie Mawad in Paris at mmawad1@bloomberg.net.

To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Nate Lanxon