The takeaway from all this is that Uber might have something to learn from Grab rather than the other way around.
With a net loss of US$654 million , Uber CEO Dara Khosrowshahi quickly clarified this had “nothing to do with the operating business”. Instead, he attributed it to a US$721 million write-down of equity stakes in firms like Chinese ride-hailing giant Didi.
Prior to the latest announcement, 46 out of 51 analyst ratings tracked by The Wall Street Journal had a “buy” or “overweight” recommendation, with a price target as high as US$100 . One analyst even wrote that Uber was just at “the start of its massive profit potential”.Shareholders have become a lot more unforgiving, given the rising cost of capital as interest rates ticked upwards after the pandemic.
after founder Forrest Li announced plans for an aggressive response to competition in e-commerce at a time when the firm’s sales and marketing growth was already outstripping topline gross merchandise value growth.Do Uber’s circumstances offer lessons for Grab, South-east Asia’s super app? After all, both have a similar business model with the same core segments of mobility and deliveries. Both rode on investor exuberance in the 2010s to scale up massively. Uber also owns 13.
Uber has stayed ahead by appealing to and retaining the young, globe-trotting elite and expatriates who typically order more high-value items and use ride-hailing services more frequently. Research by data analytics firm Measure AI in 2023 revealed that while 99.2 per cent of foodpanda users in Taiwan use the app in traditional Chinese, the language of the vast majority of the island’s population, more than 40 per cent of Uber’s users there transact in other languages.
Over the years, Grab has tested new innovative concepts under the super app umbrella. Some have worked out – like delivery batching and GrabShare – in attracting new cost-conscious users – while others were phased out – like GrabPay card – because of the high and persistent maintenance costs and the lack of scale.
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