Uber Eats Plans To End Operations In Eight Markets

Uber Eats announced it plans to end operations in eight markets by June 4. The information comes from a regulatory filing that indicates the markets represent 1% of Eats Gross Bookings.

Uber Eats is leaving the Czech Republic, Honduras, Egypt, Romania, Ukraine, Saudi Arabia and Uruguay. The company is also transferring Eats to its subsidiary Careem platform in the United Arab Emirates, so the Uber Eats app will stop working in that country after a few weeks.  

According to Uber’s Securities and Exchange Commission (SEC) regulatory filing, “These decisions were made as part of Uber’s ongoing strategy to be in first or second position in all Eats markets by leaning into investment in some countries while exiting others.”

The regulatory filing explained what Uber plans to do with the savings, “The discontinued and transferred markets represented 1% of Eats Gross Bookings and 4% of Eats Adjusted EBITDA losses in Q1 2020. Consistent with our stated strategy, we will look to reinvest these savings in priority markets where we expect a better return on investment.”

Uber has indicated that the decision to exit these eight markets is not related to the coronavirus outbreak. Instead, the company is making the changes because its goal is to be the number one or two delivery service in a market. If it is not possible to achieve this, Uber prefers to leave the market rather than compete with others.

This is not the first time that Uber has left a market it is not number one in or sold its Eats business to a competitor. In January, the company announced it sold its food delivery business in India to Zomato, which was one of the biggest food apps in the country.

“Our Uber Eats team in India has achieved an incredible amount over the last two years, and I couldn’t be prouder of their ingenuity and dedication. India remains an exceptionally important market to Uber and we will continue to invest in growing our local Rides business, which is already the clear category leader. We have been very impressed by Zomato’s ability to grow rapidly in a capital-efficient manner and we wish them continued success,” Uber CEO Dara Khosrowshahi said.

Although Uber Eats is successful in many markets, it is not dominating the entire world. In some areas, such as the case in India, Zomato was more popular, and Uber struggled. Considering this appears to be a popular strategy for the company, consumers may see Uber Eats exit other markets.