Uber introduced Uber Eats, an online meal ordering and delivery service, in 2014. Through a network of couriers who use a variety of modes of transportation, such as cars, scooters, bicycles, or walking, the platform makes food delivery easier. Uber Eats has operations in over 6,000 cities in 45 countries as of 2021.

Uber drivers are in charge of delivering food orders to clients. Uber Eats was sued in 2020 on charges of antitrust price manipulation. According to the lawsuit, Uber charged delivery fees that ranged from 13% to 40% of revenue and required restaurants to charge the same prices for delivery as for dine-in services in order to be listed on the app.

History

Company type	Subsidiary
Industry	Online food ordering
Founded	August 26, 2014; 10 years ago
Founders	Travis Kalanick Garrett Camp
Headquarters	San Francisco, California, U.S.
Area served	45 countries, 6,000+ cities
Key people	Dara Khosrowshahi (CEO)
Services	Food delivery
Revenue	$8.30 billion (2021)
Parent	Uber
Website	ubereats.com

In 2014, Uber Eats, a division of Uber, was introduced. With the launch of Uber FRESH in Santa Monica, California, the business started providing food delivery services. The platform changed its name to Uber Eats in 2015, and the stand-alone ordering app made its debut in Toronto. In 2016, the service was extended to Paris and London.

In August 2018, Uber Eats changed its fixed $4.99 delivery fee to a distance-based variable rate with a minimum of $2 and a maximum of $8. Delivery costs in the UK and Ireland were based on the order value. The business lowered its commission fee from 35% to 30% in February 2019. Uber Eats intended to open virtual restaurants—also known as cloud kitchens—in the UK as part of its global expansion. These are kitchens specifically designed for delivery-only operations.

Uber Eats had 200 cities in 20 countries in the EMEA region by November 2018 and intended to greatly expand its European workforce. The company started providing dine-in options in a few cities in 2019 and announced plans to use drones to deliver food.

Due to fierce competition, Uber Eats left the South Korean market in September 2019. Additionally, the business expanded Burger King's delivery services throughout the United States and added a pick-up option.

Uber Eats acquired a 10% share in Zomato in January 2020 after selling its Indian operations to the latter. A few days later, McDonald's switched to Just Eat for its delivery services in the UK, terminating its exclusive delivery contract with Uber Eats.

Due to social distancing concerns, people chose delivery services during the COVID-19 pandemic, which resulted in a 30% increase in Uber Eats' customer base in March 2020. Uber Eats moved its operations to Careem, Uber's Middle Eastern subsidiary, in May 2020 after leaving the United Arab Emirates, Saudi Arabia, and Egypt. Uber Eats paid $2.65 billion to acquire Post Mates later that year.

IUber Eats made its first food delivery to the International Space Station in December 2021 in collaboration with Yusaku Maezawa, a Japanese billionaire. A fuel surcharge, with rates based on delivery distance and gas prices, was introduced by the company in March 2022 for deliveries in the United States and Canada.

In the UK, Uber Eats and Tesco partnered in April 2022 to provide one-hour guaranteed delivery from 20 locations. The company partnered with Serve Robotics and Motional to launch two autonomous delivery pilots in Los Angeles in May 2022.

By December 2022, Uber Eats and Cartken had teamed up to deliver food in Miami using self-driving six-wheeled robots. The first service rollout for these robots, which are expected to deliver groceries and food, has not yet been announced.

Uber declared in January 2024 that it would merge the alcohol delivery service Drizly under the Uber Eats platform and shut it down by March 2024.

Controversies

Allegations of Monopolistic Behavior

IIn April 2020, a group of New York restaurant owners filed a lawsuit against Uber Eats, DoorDash, Grubhub, and Postmates. By forcing restaurants to sign contracts requiring them to maintain the same prices for dine-in and delivery orders if they wanted to be listed on the apps, the plaintiffs accused the companies of engaging in monopolistic practices. The lawsuit contended that, despite restaurants usually making only 3% to 9% profit, this arrangement unjustly raised the cost for dine-in customers who were forced to subsidize the delivery fees, which range from 13% to 40% of restaurant revenue. For overcharges that began on April 14, 2016, the plaintiffs requested triple damages. The case was submitted to the Southern District of New York U.S. District Court.

Antitrust Lawsuit

Uber Eats was sued again in 2022 for allegedly manipulating prices by requiring restaurants to charge the same for delivery services as they did for dine-in. The company's practice of charging restaurant partners exorbitant fees that range from 13% to 40% of revenue was also contested in this lawsuit.

Courier Pay

Delivery Job UK organized a strike by Uber Eats delivery drivers in the UK on February 14, 2024, from 5 to 10 p.m. The goal of the protest was to demand that couriers be paid a minimum of £5 per order. It is said that this strike is the biggest to affect the platform in the United Kingdom.

AI Bias

Uber Eats was embroiled in a dispute in March 2024 over its AI-powered facial recognition system. The business reached a settlement with a black Uber Eats courier whose account was deleted and his access to the app denied because of a problem with the AI's facial recognition system. The courier's selfie was mistakenly flagged as a mismatch by this technology, which has been used for identity verification since April 2020. The company paid the courier an undisclosed amount.

Finances

References