Uber to scale back car-leasing business
Uber is planning to cut back on its car-leasing business launched two years ago because of increasing costs.
Uber will consider several options for its Xchange leasing program, including selling the business or consolidating to serve fewer cities and make it more efficient, said a person familiar with the matter. The person could not be named because they were unauthorized to speak publicly on the issue.
Uber is exploring options for Xchange because the costs of owning and operating the vehicles involved in the program are high, the person said.
The program allowed Uber drivers to lease cars through dealerships. About 40,000 cars were involved in the program, along with 14 U.S. dealerships.
Uber reported losses of $708 million during the first quarter, down from $991 million in the previous quarter. Revenue for the first quarter reached
$3.4 billion.
Last month, Uber announced it was merging its Russian ridehailing business with Yandex, forming a new operation worth
$3.7 billion. The deal closes later this year, with Yandex owning a majority stake in the company.
Uber completed a similar deal in China, selling its operations in that region to Chinese ride-hailing firm Didi Chuxing.
The deals follow the departure of CEO Travis Kalanick, who stepped down in June amid growing pressure from investors seeking changes in the company’s culture.
Despite reports Kalanick is attempting a comeback as Uber CEO, company co-founder and board member Garrett Camp reportedly told employees Kalanick would not return as chief executive.