The UK is the main focus in this week’s rideshare news as Uber and Tesco team up for grocery delivery and BP and VW get together to install fast EV chargers at gas stations in the UK. Also, is Lyft scaring away investors by saying drivers need monetary incentives? All this and more in this week’s roundup with senior RSG contributor Paula Gibbins.
VW and BP will install thousands of fast EV chargers at gas stations in Europe (Engadget)
Summary: VW and BP know they’ll both have to embrace electric vehicles, and they’re ready to work together to ease some of the transitional pain. Autoweek reports the two companies are teaming up to install thousands of VW’s Flexpole 150kW fast EV chargers at gas stations in Germany and the UK. Within two years, there will be as many as 2,000 charging units (4,000 charge points) in place at BP stations in the UK and Aral locations in Germany.
The expansion should help BP expand its charging network to 8,000 connections by the end of 2024. Not surprisingly, the locations of the new chargers will be available through both in-car apps in VW group cars (including Seat and Skoda) as well as VW’s Elli charging app. The two firms also promise to explore “further opportunities” in eco-friendly transportation.
While the Flexpole chargers are quick and can deliver nearly 100 miles of charging in 10 minutes, their true appeal might be their flexibility. As they use battery storage, they can operate on low-voltage grids — it’s easier to install them at gas stations and other sites where high voltage might not be an option….
My Take: I think this makes a lot of sense. People are used to going to a gas station to power up their vehicles. It makes sense to add EV chargers to the gas stations so people can take a bathroom break and grab some snacks for the road while charging.
I think it’s a great way to keep gas stations relevant during the transition from gas-powered electric vehicles. Well done, BP!
I know there are people who are holding on as hard as possible to their gas-powered vehicles, but the truth of the matter is that we are in a transitional period right now. EVs are becoming more and more mainstream. They are starting to replace gas-powered vehicles. And, the more available charging stations are, and the more affordable these vehicles become, it’ll become a no-brainer for more and more consumers. It’s time to start changing with the times.
Uber’s Revenue Doubles, but Stock Falls After Lyft Warns of Higher Driver Costs (WSJ)
Summary: Uber Technologies Inc.’s UBER -2.83%▼ revenue more than doubled last quarter, as demand for rides rebounded from the downturn caused by the Covid-19 surge late last year and the company’s food delivery grew despite restaurant reopenings.
Uber issued a bullish outlook for the current quarter, but its shares fell about 5% Wednesday, triggered in part by rival Lyft Inc.’s LYFT -6.90%▼ results a day earlier.
Lyft spooked investors with a weaker-than-expected adjusted earnings forecast Tuesday. On Wednesday its stock was down more than 35% at one point, its biggest intraday percentage decline since it went public in 2019. It closed down 30%. The company said it would spend more to motivate drivers to return to its platform and those costs would weigh on its bottom line in the current quarter.
Uber and Lyft are grappling with a yearlong driver shortage, which has pushed up prices for rides….
My Take: Follow the link to the article which features a video interview with RSG’s Harry Campbell. He goes into detail about why drivers aren’t coming back to rideshare driving and what can be expected in the future.
In many large cities, the cost of rides is still higher than pre-pandemic levels because of the lack of drivers in those areas. Drivers want to see more pay and they want to feel safe. Throughout the pandemic, many drivers felt that delivery was a safer way to go and continue to do the delivery side of the business as opposed to the rideshare driving side.
Drivers also want to see more than hook incentives. They want to see higher pay overall. Reliable income is missing from the equation, and if there’s one thing that drivers learned from the pandemic, it’s that reliable income is key.
Uber is bouncing back from the pandemic faster than Lyft (Engadget)
Summary: Uber had a successful first quarter of 2022 by some measures, as it more than doubled its revenue year-over-year to $6.85 billion. Increased demand for rides following the Omicron surge played a role, as did higher ride prices due to a shortage of drivers.
The company reported that riders took 1.71 billion trips last quarter, an increase of 18 percent from the first three months of 2021. Gross bookings (the total amount Uber receives from customers) for rides increased by 58 percent year over year to $10.7 billion. Delivery gross bookings rose by 12 percent to $13.9 billion. Uber’s revenue from rides was $2.52 billion. From deliveries, it earned $2.51 billion in revenue.
However, Uber’s net loss increased from $108 million in Q1 2021 to $5.93 billion last quarter. That’s largely due to its equity investments in Didi, Grab Holdings and Aurora Innovation. Still, Uber believes it will be cash-flow positive on a full-year basis for 2022….
My Take: In the same vein as the story above this, Uber has a leg up on its main competitor, Lyft because Uber offers delivery services. Several drivers transitioned from rideshare driving to delivery for the pandemic. Some have transitioned back or at least opened up to both options within the Uber app, allowing Uber to remain relevant in the post-pandemic world.
This takes us to an argument we saw a couple of weeks ago that DoorDash and Lyft should team up to keep both sides of the equation as balanced as possible and create true competition for Uber.
Also in the news…
An original Uber, Lyft competitor still trying to build a new rideshare model (CNBC)
Thoughts: Lyft and Uber have had many smaller competitors over the years. It appears that Getaround is still trying to find a way to break through the model that Uber and Lyft model.
Uber Partners With Tesco for Fast Grocery Delivery in the U.K. (Bloomberg)
Thoughts: Uber continues to expand their available services and teams up with the biggest grocer in all of the U.K.
Can Uber and Lyft Survive Without Drivers? (The Street)
Can Uber and Lyft survive without drivers? Share your thoughts in the comments!
-Paula @ RSG