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Uber doubles down on online food delivery with Postmates acquisition

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Uber Technologies, in a move to mitigate the losses of its ride-hailing business during the coronavirus pandemic, has agreed to purchase food delivery platform Postmates.

April reportedly saw an 80% drop in Uber’s ride volume, while Uber Eats saw a 52% rise in orders year-on-year for Q1.

Should it go ahead, the acquisition will see the merging of two of the largest online food delivery services in the US.

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This would represent a significant threat to the business of competitors such as Grubhub and Doordash.

The Uber-Postmates deal has been agreed upon for a price of $2.65 billion in stock.

This comes amid the coronavirus pandemic which has seen sit-in dining establishments reduced to delivery-only services.

According to The Freedonia Group’s National Online Consumer Survey conducted in May 2020, 30% of adults were using restaurant delivery more because of the coronavirus pandemic.

Jennifer Mapes-Christ, consumer and commercial group leader for the Freedonia Group, commented: “This combination of Uber and Postmates will enable the two companies to expand to a more comprehensive delivery service, as both are working to build networks to deliver groceries and other essentials.”

Tags : acquisitionpostmatesUberuber eats
Sam Lewis

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