Uber & Uber Freight Investment
As reported by The Verge, Uber will invest $200 million and hire thousands of engineers to bolster its two-year-old long-haul trucking venture, Uber Freight, the company announced today.
It’s a huge vote of confidence in Uber’s growing freight division, even as Uber’s overall business continues to hemorrhage billions of dollars every quarter.
In August, Uber reported a record quarterly loss of $5.3 billion, much of which is attributable to one-time expenses like stock-based compensation.
Still, its revenue growth has slowed, and its path to profitability seems longer than ever.
The trucking industry is not an obvious place for Uber to direct its resources.
There has been a shortage of truck drivers over the last few years, with experts noting that there are not enough truckers to keep up with demand. This has led to a softening of the market, with prices dropping overall.
But Uber’s top executives say its Freight division shows promise. “Uber Freight continued to see impressive growth and great progress in Q2 despite soft market conditions,” Uber CEO Dara Khosrowshahi said in an August earnings call with investors. Still, the company did not break out revenue figures for its Freight business.
Uber Freight said that the business is growing quickly, and this new office represents Uber’s commitment to Freight as it builds innovative technology to help truck drivers find the best loads for their businesses while also accelerating logistics operations for shippers.
“Uber Freight is among Uber’s fastest-growing business units,” an Uber Freight spokesperson told Jeff Berman, group news editor for Logistics Management.
“Three years on from launch, Uber Freight has scaled across the U.S. and into Europe and, today counts 46,000+ carriers in its network and 1,000+ shippers as customers, including AB Inbev, Niagara Bottling, Land O’Lakes, and many more Fortune 500 companies.”
“Since the beginning, the Uber Freight team has been composed of the best and brightest minds in technology and trucking, with Freight workforce hubs in San Francisco and Chicago, and many more employees spread throughout the U.S. and, more recently, Europe.”
As for setting establishing a major presence in Chicago, the spokesperson said that Chicago is the heart of the global transportation industry and has long been one of Uber’s biggest business centers.
“It was a natural fit for the Uber Freight HQ as we rapidly scale our world our world-class team to support Uber Freight’s growing global opportunity,” the spokesperson said.
“Uber Freight is a global business, innovating logistics solutions for shippers of all sizes across the US and Europe.
This investment in Chicago shows that Uber is bullish about Freight’s growth. Scaling the team – specifically, our engineering team – in Chicago will enable us to meet the massive market opportunity that exists today, better serving shippers all over the world.”
As for staffing at the new Chicago facility, Uber plans to hire 2,000 new employees in the region, known for its tenured trucking and technology talent, over the next three years, the majority of which will be dedicated to Uber’s growing Freight business.
Uber Freight puts down roots in Chicago
In three years since launch, Uber Freight has grown to a team of hundreds, with offices in San Francisco, Chicago, and Amsterdam. Now, Uber Freight will be solidifying its investment in Chicago with a new Freight headquarters at The Old Main Post Office, in Chicago’s historic downtown.
Globally, freight is a 3.8 trillion dollar industry ripe for change, and Uber Freight is leading the way towards a more efficient and collaborative freight future. We’ve built cutting-edge technology for both sides of the freight marketplace, unlocking opportunity for shippers, carriers, and their drivers so that they can focus on improving their bottom lines, growing their businesses, and keeping their eyes on the road ahead. We’ve pushed the entire industry towards transparency with features like facility ratings and real-time pricing. And this year, we brought these same values and logistics solutions abroad, expanding operations into Europe.
Chicago is consistently at the forefront of innovation, from building America’s foundational transportation systems and its first skyscraper to fostering world-class universities and research centers. The city has always been at the heart of the global transportation industry, and we’re eager to continue that legacy. Tapping into Chicago’s rich history and incredible potential, we’ll be investing $200 million annually in the region, through headcount, real estate investment, and other expenses to support Uber’s local operations.
Since the beginning, Uber Freight has built a community composed of the best and brightest minds in technology and logistics. Strengthening that team and shepherding in the next era of growth for Uber Freight will be our priority in Chicago. We’ll grow our team significantly, hiring thousands of new team members who are inspired by our mission to reimagine modern logistics. Specifically, Chicago will quickly become our first engineering hub outside of San Francisco, where we’ll scale the team that keeps pushing our technology forward.
This expansion is a testament to Uber’s long-term commitment to transforming the way goods move with Uber Freight. Alongside Eats and Rides, Uber Freight is constantly looking towards the next frontier – working to redefine what’s possible so that we can have the biggest impact on the people that keep our economy moving. I’m humbled by and proud of the work we’ve accomplished together, and I’m excited to see what opportunities Chicago unlocks for us.
From Lior Ron, head of Uber Freight
Source: Uber Freight Blog
Image: Uber Freight
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