Just last week, Uber (NYSE: UBER) boldly honed in on the traditional NY taxi market. Investors reacted well to the Taxi-merger plans, with UBER shares jumping around 5.5%. We’ve seen a similar reaction in the market this morning; shares are currently trading at a further 5% gain on the news that Uber will be extending their plans to San Francisco. Uber is targeting San Francisco-based Flywheel Technologies to allow Uber passengers in the city to hail a taxi through the Uber app.
The pilot program is awaiting approval from the San Francisco Municipal Transportation Agency, expected to take place at the beginning of April. Should Uber and Flywheel get the green light, San Francisco taxi drivers that are active on the Flywheel app will benefit from the integration of Uber customers.
The move, as mentioned after the proposal of the New York deal, could potentially settle years of market scuffles between Uber and traditional taxi drivers, but it isn’t all clear skies and rainbows; many San Francisco and New York drivers are against the new decision on the grounds that it could lead to lower earnings, or make it more problematic for longtime taxi customers to get affordable journeys.
New York, San Francisco; where next? The mobility company’s plans to integrate traditional taxis could spur a much-needed revenue boost following a dip in the pandemic. The likelihood is that these two cities are part of a much larger plan from Uber. Should the company continue on its integrative journey, current price levels seem attractive given the upside that could unfurl.
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Oliver is a financial writer and analyst specialising in the US stock market, with years of personal experience in understanding micro/macroeconomic structures, market trends and fundamental analysis.