Key points:
- Uber announces the surprise listing of NY taxi drivers on its platform
- UBER gained around 5.5% premarket
- The move comes as the company faces driver shortages and slow pandemic revenue
One of the global leaders in mobility made a surprising announcement today. Uber is no longer exclusively for Uber drivers in a decision from management to list all of New York’s traditional taxis. It’s the largest decision from the company to date and represents a clear exposure strategy that should help claw back revenue lost over the pandemic. Uber stock gained around 5.5% premarket on the news as investors react well to the new NY taxi monopoly.
Uber has been forced to think outside of the box lately as various headwinds have thrown the mobility market in decline. In particular, a widespread driver shortage doesn’t bode well for the worlds leading app-based taxi service, so Uber decided to broaden its brand horizons by allowing NY taxi drivers to register on the app and work through the Uber platform.
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The deal also acts as a sort of peace offering. With New York being on a global honeypot for tazi drivers, the rife conflict between traditional taxis and the ever-growing Uber brand continues to cause tension in the mobility market; Uber’s decision today provides somewhat of an equal, inclusive marketplace for taxi drivers to operate; whether as an Uber driver or not.
In Uber’s last quarterly report, the company reported a prominent bounce in revenue driven by a return in airport bookings and a return to traditional work travel, but the company still lacks behind pre-Covid levels. This bold bid by Uber could transform the very concept of the company itself.
Arguably, loyal Uber drivers might miss out on earnings due to a large rise in available drivers; but due to pricing variations, it shouldn’t have much of a negative impact. All in all, the decision massively increases Uber’s exposure, unveils further monetization for the company, and allows traditional Taxis to benefit through Uber’s easy app-based interface.