Grab-Uber merger

Uber should have changed business model instead of selling

I find it hard to believe that Uber's decision to sell its South-east Asian business to arch-rival Grab is being hailed as a sensible move for the company (Uber's retreat to focus elsewhere a sensible move; March 26).

It only demonstrates that the company is no longer innovating and has given up its hope of becoming a world leader.

These were the very reasons that investors continued to pump money into the company despite it losing money.

By conceding South-east Asia to Grab, Uber is admitting that not only does a much smaller company have as much technology as it has, but it is also unable to widen the gap.

A smarter move for Uber would have been to change its business model to that of major hotel brands which are recognised globally.

It could have looked for local partners in each region to own the business and address issues with the local authorities.

In return, Uber could have offered the partner technology, recognition of the brand name by consumers, global marketing and a proven business model.

In the long run, this approach would have ensured that regional players like Grab and Didi would not be given the space to grow.

The consumer would also always have a choice of ride-hailing options in each region.

Liu Fook Thim

A version of this article appeared in the print edition of The Straits Times on March 30, 2018, with the headline 'Uber should have changed business model instead of selling'. Print Edition | Subscribe