Uber’s Latest Numbers, Layoffs And Rider Tool Suggest More Trouble Ahead
One of most powerful tools Uber used to run off Taxi companies was blogging. Its executives organized well known bloggers and used the most effective ideology of discrediting cab owners and their drivers in most manipulative ways to discredit their actions and almost destroyed taxi industry worldwide. The strategy worked in most spectacular way that it dramatically attracted investors from everywhere and inflated profit was announced. However as time goes by, it is vivid that Uber could not hide its losses. In February, several pieces of Uber Technologies news (in a seemingly perpetual stream, to be fair) could suggest further challenges for the company as it aims for profitability.
Earlier this month, Uber reported its 2019 fourth quarter earnings, with a net loss of $1.1 billion, marking a slight improvement on the previous quarter. CEO Dara Khosrowshahi made headlines by telling investors that the company nevertheless plans to be profitable in 2021, if not sooner. Industry analysts and media outlets have been skeptical of this plan, however, given Uber’s ongoing struggles with US and international regulators, drivers’ groups, and its own spending habits.Uber has been under pressure from investors to stem its enormous losses and show how it can start posting a profit. One big reason, the site noted, is that Uber's Rides division, a.k.a. “its core business, is facing serious challenges in its core markets because the gig economy is under attack by regulators worldwide, which has been downplayed so far.”
Amid its regulatory struggles and large overseas investments, Uber’s recent efforts to cut costs have apparently involved multiple rounds of layoffs, with reportedly more than 1000 Uber employees losing their jobs in 2019.In mid February, the Los Angeles Times first reported that Uber laid off roughly 80 more employees this month, at a Los Angeles customer service center, and will outsource those jobs to Manila, Philippines. According to the Times, most were hourly-paid workers who focused on driver outreach, such as addressing account problems and explaining how Uber’s pay incentives work.The following day, the company also rolled out a new feature for US and Canadian riders, allowing them to “discreetly” submit non-emergency feedback to the company, who reportedly won’t reveal customers’ identities to drivers later on. Examples of such feedback provided by Uber include "harsh braking," "inappropriate remarks" and "my driver doesn't have a phone mount."
It’s one of multiple safety-targeting tools that Uber has released in recent years as safety concerns about this and similar platforms have continued to mount, on behalf of riders but also drivers themselves.Over the past few years, hundreds of passengers and drivers have come forward alleging sexual assault and other abuses during rides. Several lawsuits have been brought against Uber by people saying they were raped, kidnapped or groped by drivers [while its rival Lyft] has been sued by at least 56 women since August alleging sexual assault by drivers. The tool is designed to be used during rides, said Tracey Breeden, Uber's head of women's safety, in a blog post Wednesday. "Our research shows that riders may not consistently report experiences that make them feel uncomfortable or nervous due in part to being distracted after the trip," she wrote.
However, ride-hail drivers have been quick to express their concerns about the new tool, and how nitpicking or retaliatory feedback from riders could weaken their driver profiles (which can determine their level of access and rates for rides) without much opportunity for recourse.In light of Uber’s recent changes to its customer service team, and drivers’ ongoing complaints about being unable to get assistance from the company and that they are often summarily penalized or kicked off the app for different infractions, such concerns seem reasonably well warranted.
Taken together, these recent news points also suggest that Uber still has an uphill battle toward profitability, and that its main resources — its drivers, its riders, and its so-far generously willing investors — can still expect things to get worse for the company before and if they improve.