One of the sectors that is being most affected by the coronavirus crisis and the quarantines imposed by the governments of many countries to stop its expansion is mobility. With millions of people confined to their homes , teleworking and unable to go to bars, restaurants, entertainment venues, etc. because they are closed, users do not need to travel and, therefore, do not need to take any transport.
You don’t have to be an economist to imagine how measures of this type could affect a company like Uber and its business. In a conference with investors, the technology firm has acknowledged that the volume of users who take Uber vehicles has drastically precipitated. In some cities it has been reduced by 70%.
However, there is good news. Despite this drop in demand, which also means a substantial drop in income, the survival of the company is assured . So at least the CEO of Uber, Dara Khosrowshahi, has assured.
The transport firm would have more than enough cash to be able to endure and overcome the crisis. The manager has revealed that even in the worst case scenario, where their travel volume could be reduced by 80% (a figure that they hope will not be reached), they could survive if they pull on liquidity.
UberPool is suspended, but new formulas are being sought
How much money does Uber have in its box to deal with the travel stop? The CEO of Uber has revealed to TechCrunch that they have 10 billion dollars in their box (of which 1.5 billion dollars in theory are reserved for mergers and acquisitions operations). In addition, they also have a line of credit of 2 billion dollars.
“The most important thing is to know that we are well positioned to face this crisis and come out even stronger. We have ample liquidity. We have a highly variable cost structure, a global footprint, multiple lines of business that give us some diversity, and case studies on how quickly our companies are likely to recover after a crash like this. All of this gives us confidence… As soon as companies and businesses start to move, Uber will also do so ”, Khosrowshahi assured the aforementioned media.
In addition, Uber is also trying to help out with the problem. According to the manager, the company would be looking for formulas to take advantage of its fleet of drivers to help fight the coronavirus and be of help to people who are confining themselves to their homes. The Uber boss recognizes that they already have contacts in the health sector and have the processes they need to start offering rides with this orientation.
To prevent the spread of the virus, the company has also made the decision to suspend its Uber Pool service. It is the ridesharing alternative offered by the house, that is, this option allows users to travel with other people who are going in the same direction and thus be able to save, congest cities less and save emissions.
