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Uber Eats exits Saudi Arabia and Egypt, transfers business to Careem Now in UAE

Written by MENAbytes Published on 

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Earlier this year, Uber Eats exited India by selling the food delivery business to local rival Zomato in an all-stock deal.

Uber Eats, the food delivery arm of Uber, is exiting Saudi Arabia, Egypt, and five other markets, the company said in a regulatory filing and emails sent to its customers today. In addition to exiting Saudi Arabia and Egypt, Uber Eats will transfer its business operations in the United Arab Emirates to Careem, which operates its own food delivery service Careem Now in the country.

The exit from the Middle East comes almost four years after it expanded to the region with its Dubai launch in 2016.

In the filing, the company said it will discontinue Uber Eats’ operations in the Czech Republic, Egypt, Honduras, Romania, Saudi Arabia, Uruguay, and Ukraine by June 4.

In an email sent to its customers in Saudi Arabia, where its food delivery service is available in Riyadh, Jeddah, and Dammam, Uber said that the service there will be suspended at the end of the day.

“After years of partnering with local restaurants to offer convenient, reliable food delivery, we have made the difficult decision to discontinue Uber Eats in Saudi Arabia at the end of Monday, 4 May. While we are sad that Uber Eats is leaving Saudi Arabia, we are committed to continue serving our communities here through our Uber Rides business,” read the email. “Our number one priority now is to minimize the impact on the valued employees, restaurant partners, delivery partners, and consumers who have supported us.”

In a similar email sent to its Egyptian customers, Uber said that Uber Eats will be discontinued in the country on May 18. And the email to customers in the UAE explained that Uber Eats is joining forces with Careem and the customers there will be able to place their orders using the Careem Now app from May 18 onward.

What’s interesting about this move is that Uber hasn’t announced a similar transfer of business in Saudi Arabia to Careem. Careem Now has been operating in the country since December 2018.

The filing by Uber notes that the company made the decision to exit these markets as part of its ongoing strategy to be in “first or second position in all Eats markets by leaning into investment in some countries while exiting others.”

“The discontinued and transferred markets represented 1% of Eats Gross Bookings and 4% of Eats Adjusted EBITDA losses in Q1 2020. Consistent with our stated strategy, we will look to reinvest these savings in priority markets where we expect a better return on investment,” read the filing.

Read this: Uber Eats sold its India business to local competitor Zomato for USD 206 million

Even though Uber Eats is leaving the Middle East with this move, Uber will indirectly continue to have food delivery interests in the region through its subsidiary Careem.

Earlier this year, Uber Eats exited India by selling the food delivery business to local rival Zomato in an all-stock deal.

Glovo, the European on-demand delivery startup that was fairly popular in Egypt, also announced its exit from the market earlier this year.

This article first appeared on MENAbytes.

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