Posting a loss of US $13m in the third quarter, Uber Freight “has been able to weather these trends better than some of [our] competitors, as evidenced by several industry players winding down operations,” according to Uber CEO Dara Khosrowshahi.
The $14m y-o-y fall in operating profit was off the back of a 27% y-o-y decline in revenues to $1.286bn. The Uber CEO said that Uber Freight had “remained pressured by near-term category-wide headwinds as capacity in the truckload sector continues to normalise.”
Despite some signs of recovery in the US road transport industry, Khosrowshahi continued, “we aren’t hanging our hats on an imminent rebound,” adding, “It’s in tougher market environments where we can further differentiate our offerings from sub-scale or traditional competitors.”
Waabi Driver-as-a-Service Partnership
One of the key ways that Uber Freight is differentiating its offerings is through autonomous trucking. In September it announced a partnership with Waabi.ai, which deploys, maintains and manages autonomous truck assets.
Where Waabi claim to be different is that they can deploy their system fleet-wide very quickly, and using a central platform called Waabi World, can use AI to learn for itself as opposed to be ‘taught’ via external coding. This will mean that one truck learns from a situation and passes its lesson onto the whole fleet.
Over 10 years the two companies plan to deploy autonomous trucks on the Uber Freight network. As of September Uber Freight was already using autonomous trucks on a route between Houston and Dallas in Texas. They plan to rapidly expand the service beyond this route.
The move comes at the right time, with a driver shortage set to be in the region of 160,000 drivers by 2028. As such, driverless trucks could resolve a building problem for the logistics industry. Waabi claim that autonomous trucking will create around 30,000 new jobs in the industry across the US annually, though these may be more attractive and highly skilled than traditional driving jobs.
Other Incremental Improvements
At the same time as the autonomous trucking announcement, Uber Freight has taken measures to improve some of its existing services. Using AI Large Language Models (LLMs), it has launched the Insights AI platform that aims to analyse big data to help its freight clients’ logistics making. The company has also improved its transport management system, enhancing visibility, foresight and control.
Uber Freight is now the only loss-making division of the Uber Technologies group. Making a small profit of $1m in Q3, 2022, this is an anomaly caused by factors that have hit the US road freight industry as a whole. Khosrowshahi has still taken measures to improve profitability however, adding “We remained disciplined in cost management, with adjusted EBITDA stable sequentially. Year to date, we’ve implemented approximately $50m of annualised cost savings in a tough market backdrop.”
Author: Richard Shrubb
Source: Ti Insights
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