Dive Brief:
- Uber CEO Dara Khosrowshahi spoke to Shannon Bond at the Financial Times (FT) this week about goals and achievements during one year at the company thus far, specifically about making the previously scandal-plagued company better and more responsible. "The internal work on culture remains incomplete. And the fact is that it’s going to take years," Khosrowshahi told FT.
- Uber recently acquired dockless e-bike operator Jump, and Khosrowshahi aspires for similar alternative mobility ventures, including scooters and public transit, to make Uber an overall transportation hub. "There’s a $6 trillion mobility market, and no one product is going to be serving that whole market," he told FT. "The ultimate competition here is car ownership, and boy is that a big market to go after." Khosrowshahi also announced Uber's long-term strategy involves a significant shift from cars to electric bicycles and scooters for shorter trips, especially in urban areas.
- Despite Uber's much-publicized fatal autonomous vehicle (AV) accident earlier this year, Khosrowshahi plans to continue onward with exploring AVs. "In this business things change so fast that everything’s got to be on the table," he told FT. "One of the core tenets of innovation and making bold bets is also being willing to kill things that aren't working." Uber laid off about 300 employees when it shut down its AV pilot in Arizona after the accident, and it laid off more this summer during a restructuring of the remaining AV program in other locations.
Dive Insight:
Uber experienced a $4.5 billion loss in 2017 and still has not reached profitability, yet Khosrowshahi has received accolades for his efforts to turn around the company. He has openly addressed the company's previous missteps and vowed to do better. The company's reputation had been tarnished with a series of scandals, including sexual harassment and accusations of employee mistreatment, that led to the previous CEO's resignation. Although the company's problems are not all solved — especially financially — the Uber of today overall appears differently in the public eye than before Khosrowshahi arrived.
Uber and competitors like Lyft have reshaped the mobility space in a short amount of time, so transportation experts closely watch for future business decisions that could similarly alter the mobility status quo. One of those decisions some consider unique is the idea of diversification into alternative modes of transportation — not exactly intuitive for a car-based business. Khosrowshahi pointed out the company will likely take short-term financial hits for the shift in focus.
Continuing to push into new mobility space and get cars out of the densest city centers is a good idea though, considering cities' love-hate relationship with ride-sharing services. Although leaders recognize the benefits to citizens, they also criticize the reported increases in congestion caused by ride-sharing. New York recently became the first city to regulate ride-sharing, and two Chicago aldermen have advocated for doing the same. With more regulations likely coming down the line, aiming to expand the business solely with vehicles likely would be a losing battle for Uber.
Other mobility providers besides Uber have recently adopted the notion of partnering with providers of different modes of transportation. Lyft acquired bike-share operator Motivate this summer and laid out plans to partner with cities on bike- and scooter-share programs. Like Uber, Lyft is making moves to integrate with public transit as well.
For the foreseeable future, ride-sharing companies likely will continue to shape mobility within cities and present emerging possibilities. It will be interesting to see the pace at which Uber proceeds and whether its business ventures become more conservative or more innovative, considering Khosrowshahi's confirmation that the company intends to go public soon and will have to woo investors.
