COVID-19 Update: Uber Expands Again with Recent Acquisition

By Desiree Homer

Rideshare giant, Uber, is in the news again with ongoing advancement and growth strategy. Last Thursday, Uber Technologies Inc. announced its acquisition of Routematch, a transit software provider. Uber has been expanding its agency partnerships, and this latest announcement only moves the company closer to public transportation segments. The rideshare market continues to secure its foothold and presents real revenue opportunities for dealers.

What the Acquisition Means for Uber

This recent acquisition of Routematch will provide a more rapid expansion of Uber’s agency customer roster. But it also marries the on-demand tech between both companies and allows for combined routing strategies. Uber’s head of transit, David Reich, discussed the plans in an interview last week. He says this combining of resources will “let us go so much further, so much faster,” with regard to powering the public transit segment. Routematch, which is based in Atlanta, already provides more than 500 transit agencies throughout Australia and North America, with payment processing, fleet management, tracking, and scheduling technology. It puts a significant connection feather in the Uber hat.

Ridesharing Still Presents a Host of Dealership Opportunity

Despite shifts in consumer confidence and virtual car-buying trends, the rideshare economy continues to be strong and resilient. As the popular taxi-related industry continues to grow, and with it the players like Uber and Lyft, there are ongoing dealer opportunities to tap in for revenue. Individuals who drive for these companies will continue to need comfortable, fuel-efficient cars. Dealers, in recent years, have explored various ridesharing sales strategies to help those drivers afford reasonable vehicles. Others have leveraged the use of loaner fleets or aging pre-owned models for a monthly fee platform with drivers directly. As the pandemic continues to shift how dealers engage with the car-buying public, it’s revenue channels like these can help them sustain economic setbacks.

Being Prepared and Creative

When headlines suggest the virus is making a comeback, there is potential for the auto industry to begin regressing again. Michigan Governor, Gretchen Whitmer warned her state last week that with surging positive cases, and a public refusing to abide by the current mask order, she may resort to shuttering businesses, including the automakers. In other states, like Florida and Arizona, pandemic conditions have already forced some local officials to close businesses already. Cox Automotive Chief Economist, Jonathan Smoke, warns, “the next three to six months could see some reversing trends,” as a result of the virus. Smoke talks with Dave Cantin in a recent episode of the Dealer News Today podcast, that dealers can’t presume to know what will happen next. And even though May and June have proven to have robust return-to-market data, dealers should remain cautious and prepared. Facing ongoing pandemic effects, volatile economic conditions, and a presidential election, dealers can’t afford not to leverage every revenue-generating opportunity before them.

Exploring a rideshare lease program within your operations might make sense, depending on your region and population. But as companies like Uber continue to expand efforts into various segments like public transit, it serves as a reminder that dealers, too, should be looking for creative ways to grow into the opportunities and revenue channels as they become available.