Atheer – External Sources
Dara Khosrowshahi, Uber CEO, has pledged to continue investing aggressively in Southeast Asia, despite the fact that the US company expects to lose money in the fast growing market, as a result of costly battles with rivals such as Grab.
According to Reuters, SoftBank’s fifteen percent stake purchase in Uber last month has opened up the possibility of combining Uber with other ride-hailing assets owned by the former across Asia. SoftBank has stakes in Singapore-based Grab and India’s Ola.
At the time of the investment, SoftBank said that it wants Uber to focus on developing in the United States, Europe, Latin America and Australia, rather than Asia, which has been among the most costly and competitive regions for the ride-services firm.
Uber is preparing to sell its Southeast Asia ride-hailing business to Grab, in return for a substantial stake in the company, as reported by CNBC earlier this month.
Khosrowshahi however dismissed that strategy on Thursday in his first official visit to Asia since taking over as Uber CEO last year.
“We expect to lose money in Southeast Asia and expect to invest aggressively in terms of marketing, subsidies etc,” adding that there exists huge potential in the region thanks to a significant population and fast internet user growth.
Khosrowshahi said that while SoftBank is an investor, Uber, valued at around $68 billion, will take any final decisions along with the board on mergers and partnerships. He that said he does not expect any change in Uber’s India operations following the deal with SoftBank.
India is one of Uber’s fastest-growing international markets and accounts for more than ten percent of Uber’s trips globally, yet Khosrowshahi explained that i isn’t making money just yet.
Uber and India’s market leader Ola have been locked in a fierce battle, pumping in millions of dollars of investors’ money for a bigger piece of the country’s $12 billion taxi market.