After a hundred departures, what direction for the new management of FreeNow France?

Change at the head of FreeNow (ex-Kapten, ex-Chauffeur Privé). The VTC service, which belongs to the mobility joint venture of Daimler and BMW, appointed Dimitri Tsygalnitzky on Tuesday April 6, 2021 to head its activities for France.

A hundred departures for FreeNow France
The man takes the reins of a French division which has suffered a large number of departures and layoffs following the integration of Kapten into FreeNow. Product development no longer takes place in Paris but in the tech hubs of Hamburg, Berlin and Barcelona. About a hundred “technical profiles” have either left the company or joined the Barcelona hub. The Parisian workforce is no longer reduced to a hundred employees.

Review of the past year, FreeNow’s strategic ambitions and status of drivers, Dimitri Tsygalnitzky provides an update with L’Usine Digitale. Previously in charge of FreeNow’s BtoB activities for Eastern Europe, he is aware of the challenges inherent in the VTC sector and the place of the company on the European market.

End of the price war?
After a record year 2019 due to the demonstrations of the yellow vests and the transport strike, FreeNow recorded a drop of around 40% in races over the year 2020. But Dimitri Tsygalnitzky assures that his appointment is made “in the context of resumption of activity”. Proof of this is: if the activity dries up after each announcement of containment or curfew, a quiver of demand is felt a few weeks later.

The goal for the end of 2021 is to “return to the level of 2019 in number of races”, says Dimitri Tsygalnitzky. In terms of users, the goal is to double the base number to have enough demand, even if these users are not active every month. Of its 3 million users in France, FreeNow has identified 30% of assets since the start of the year. On the turnover side, the goal is to “return to 2019 levels but in a healthier way”, specifies Dimitri Tsygalnitzky, for example by limiting marketing offers aimed at attracting customers at the cost of promotional offers.

Is the price war over? The new DG France assures us that it is time for “more reasoned growth” has arrived and the hypercotor at the lowest prices is coming to an end. The trend is towards consolidation in the mobility sector and more particularly on the French and Parisian markets (such as SnapCar with Le Cab). “What will differentiate the platform from another is the quality of the service, he wants to believe. The more a driver is engaged with a platform, the better the quality of the service “.

What status and advantages for drivers?
Proximity to drivers, but also passengers, is moreover one of the five strategic pillars put forward by FreeNow for its development. “We must guarantee fair remuneration to drivers”, assures Dimitri Tsygalnitzky. First claim according to him of these little hands essential to the operation of VTC platforms. The drivers’ income depends mainly on the level of the commission (FreeNow takes 20%) and the calculation of the price of the trip which is indexed to supply and demand.

FreeNow is also watching closely the announcements about this much-maligned self-employed status. Recently Uber reclassified the drivers working on its platform as ‘workers’ in the United Kingdom. But, Dimitri Tsygalnitzky defends himself by ensuring that in this country, FreeNow has set a commission at 15%, lower than that of Uber which is 25% and therefore compensates with profits. And ensure that the first concern of drivers is their salary, and not the social benefits (and constraints) inherent in the status of employee. However, changes seem inevitable. French justice has repeatedly reclassified as an employment contract the relationship between a self-employed person and a digital platform. Subject on which the European Union is currently working.

Multimodal, territorial network and environment
VTC, taxis, soft mobility, public transport: to attract more customers, FreeNow wants become a benchmark multimodal platform. This will mainly involve the conclusion of partnerships, such as the one with the self-service electric scooters service Tier Mobility. On the public transport side, “FreeNow exchanges with RATP”, reports Dimitri Tsygalnitzky, and hopes to integrate the Parisian public transport network into its application by the end of the year.

At the same time, FreeNow wants strengthen its territorial network in France. This third strategic pillar involves the opening of several cities including Lille and Bordeaux by the end of the year. The latter was to see the application land in December on its territory, but the Covid-19 has shaken up its plans.

The fourth and fifth pillars are environmental issues and strengthening of B2B activities. To attract more businesses, FreeNow relies on tailor-made solutions, ordering for others and the provision of reliable, safe and responsible drivers. On the environmental side, FreeNow wants to achieve zero carbon by 2030. An ambition that involves an increase in the electric vehicle fleet and work on the dispatch algorithm to reduce the distance of drivers who accept the races. Initiatives aimed at attracting customers concerned about these environmental issues. The final objective is to position itself as Uber’s first competitor in France.

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