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Uber Purchases Competitor Careem

Uber Purchases Competitor Careem

Uber Purchases Competitor Careem

Uber, the largest ride-hailing service globally, has announced the acquisition of their competitor, Careem.

Uber’s purchase of Careem, may reduce competitiveness in the market, increasing their monopoly as well as allow a more solid foundation to expand their services globally and nationally in Pakistan and the Middle east.

Careem and Uber are very popular in the major cities internationally.

Careem operates in approx 90 cities, with 30 million customers and one million taxi drivers.

The main elements of the acquisition are as follows:-

  • The purchase price is $3.1bn, being paid partly in cash and part conversion into Uber shares
  • Careem will contine as an independent brand
  • Existing management of Careem will be retained
  • Daily operations will be largely unaffected
  • Purchase will be completed by 2020

Currently, with almost a 99.9 per cent monopoly, Uber has become the largest ride-hailing service in Pakistan.

Careem taxi drivers remain optimistic that Uber will utilise Careem’s expertise, enhance professionalism and improve its services. Reduced competitiveness between the rivals may not help the customers long term pricing value for money.

Data protection and its proper utilisation will come under greater scrutiny.

Uber feel that riders will benefit from a higher density of vehicles, lower wait times and other improved rider experiences, such as better mapping technology leading to accurate, efficient pick-up and drop-off locations.

Human resources and employment rights will also need to be properly managed and executed.

Consolidation and streamlining services may improve the services, whilst simultaneously reducing competitiveness.

Uber are reluctant to admit there will be any adverse impact on fare, policies, and technology.

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