Uber announced on Monday a partnership that will allow its users to charter private buses and coaches through its app, furthering its expansion into different modes of transport beyond its core ride-share business.
The option, which will be rolled out across the US in the summer, is targeted at events such as weddings or wine tours. Vehicles and drivers will be provided by US Coachways, one of the country’s largest bus chartering services. Uber will receive an undisclosed service fee from each booking.
Another feature announced on Monday, Uber Travel, will encourage business travellers to reserve rides days in advance, in an effort to help further manage supply and demand as driver availability continues to be a pain point.
Along with the Uber Eats restaurant and grocery delivery business, the extra travel integrations are part of Uber’s continued efforts to create a so-called superapp, with a multitude of services on one platform, similar to a handful of services that have exploded in popularity in Asia, such as WeChat.
Uber recently added traditional taxis within its app in cities such as New York and San Francisco, in a thawing of a formerly hostile relationship between the Silicon Valley firm and the industry it disrupted.
In the UK, Uber is experimenting with adding long-distance travel booking options, such as planes and trains, with a view to offering the same in other markets globally.
As well as taking a slice of additional journeys not previously covered by the Uber app, integrating other modes of transport is seen by the company as a way of boosting its ride-share business, by encouraging users to take trips in its cars between transport hubs.
The new Uber Travel feature prompts users to link their Google accounts to Uber in order to share details about upcoming travel, such as flight times, hotel bookings and dinner reservations.
Using that data, Uber will allow users to book in advance several Uber trips to and from relevant locations. Reservation times will automatically react to changes in circumstance, such as a delayed flight, the company said.
The move stands to give Uber more insight into the travel habits of its 115mn active monthly customers, in particular the more lucrative business traveller.
Encouraging customers to book ahead of time will help manage driver supply issues by getting an upfront view of demand. The company had been forced to invest heavily in attracting drivers back to the platform after many deserted it during the coronavirus pandemic.
In a recent earnings call, Uber said drivers joining or returning to the platform were up 121 per cent year on year in April. Uber shared the figure in an attempt to reverse a big sell-off in the company’s stock after ride-share rival Lyft forecast at tough year ahead in which it would need to invest heavily in driver incentives.
Recent independent analysis from RBC Capital Markets suggested rising fuel costs were weighing heavily on driver supply, despite efforts by companies to offset some of the cost for drivers.
Uber’s attempted reassurance to investors has not been enough to spare the company from the broad sell-off seen across the sector since last November. Before markets opened on Monday, Uber’s stock was trading down 44 per cent since the start of the year.
In a recent memo to staff, obtained by the Financial Times, chief executive Dara Khosrowshahi said the Wall Street mood meant the company must rein in its spending.
“Some initiatives that require substantial capital will be slowed,” Khosrowshahi wrote. “We have to make sure our unit economics work before we go big. The least efficient marketing and incentive spend will be pulled back. We will treat hiring as a privilege and be deliberate about when and where we add headcount.”
Source: Financial Times
