Uber has bought the British minicab software company Autocab for an undisclosed amount, giving it a new platform for its first major expansion in the UK in four years.
The purchase will allow Uber to offer users journeys in towns such as Oxford, Doncaster and Aberdeen where it does not currently operate. But rather than booking an Uber car in those towns, riders opening the app will be able to book a minicab from a local outfit instead.
Autocab, which will continue to operate as an independent business after the acquisition, provides technology such as the dispatch app iGo. That service allows minicab companies across the UK to pool their customers’ bases, and is currently advertised to those independent companies as “helping you compete with apps such as Uber, MyTaxi and Lyft”.
Safa Alkateb, Autocab’s chief executive, said: “Autocab has been working with local operators across the world to provide the technology to make them more efficient and open up a marketplace to provide more trips. Working with Uber we can scale up our ambitions, providing hundreds of thousands of additional trips for our customers, and help cement the place of licensed operators in their local community.”
Jamie Heywood, Uber’s regional general manager for northern and eastern Europe, said: “Autocab has worked successfully with taxi and private-hire operators around the world for more than 30 years and Uber has a lot to learn from their experience. We look forward to working with the Autocab team to help local operators grow and provide drivers with genuine earnings opportunities.”
Uber says that each month hundreds of thousands of riders open the app in cities that it does not currently serve, including 67,000 in Oxford, 25,700 in Exeter and 23,700 in Doncaster. The company has not expanded to a new British town since 2016.
The UK is a particularly heavily regulated market for Uber to operate within, and the company is required to legally set itself up as a minicab firm in each town and city in which it operates. That gives individual councils the power to approve or reject Uber’s application to operate in their jurisdiction, as well as apply other limits as they see fit.
By using Autocab’s partnerships with independent minicab operators, the company will manage to sidestep some of those requirements. But, at least initially, the partnership will only apply in those areas where Uber doesn’t currently operate. Riders will book a car through the Uber app, which will be clearly marked as provided by an independent company, and the independent driver will receive their booking and payment the way they currently do for any booking.
“Through Autocab’s iGo marketplace, Uber will be able to connect these riders with local operators who choose to take their booking,” the company said in a statement. “In turn, operators should be able to expand their operations and offer more earnings opportunities to local drivers. Uber will also explore providing drivers with additional revenue opportunities related to its platform for other services, such as delivery.”
The acquisition could also provide a lifeline to the company if a TfL ruling from November 2019, which stripped the company of its licence to operate in London, is upheld. The ruling, which found that Uber was not a “fit and proper” body to act as a private hire operator, is currently suspended pending appeal.