Uber Eats delivery
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LONDON — The CEOs of Uber and Just Eat Takeaway on Wednesday became engaged in a public spat after Uber announced it is planning to launch in Germany — a market that is currently dominated by Just Eat Takeaway.
Uber Eats will launch in Berlin in the next few weeks and potentially expand into other German cities in the coming months. The news was first reported by The Financial Times and confirmed to CNBC.
Just Eat Takeaway CEO Jitse Groen accused Uber CEO Dara Khosrowshahi of trying to “depress” his firm’s share price on Twitter on Wednesday. Shares of Just Eat Takeaway closed down almost 3%.
Khosrowshahi responded: “Advice: pay a little less attention to your short term stock price and more attention to your Tech and Ops.”
Shortly thereafter, Groen replied: “If I may … start paying taxes, minimum wage and social security premiums before giving a founder advice on how he should run his business.”
Uber operates its ride-hailing service in 13 cities across Germany but the company has never launched Uber Eats in what it views as a strategically important market.
A spokesperson for Uber told CNBC: “As part of our ongoing investment in Germany, we’re excited to be launching Uber Eats to unlock the full potential of Uber’s mobility and delivery platform.”
“Based on feedback from restaurants and communities, we believe there is strong demand for more food delivery services and a more competitive market. We look forward to helping consumers, restaurants and workers access the benefits of the Uber Eats marketplace very soon.”
In Europe, Uber Eats is currently available in the U.K., France, Spain, Italy, Switzerland, Italy, the Netherlands, Belgium, Sweden and Ireland. Approximately 24 million people used the app to order food from around 126,000 restaurants in Europe last year, as lockdowns resulted in more people ordering takeaways.
“Europe in particular has been a bright spot for (Eats), both in terms of some of the growth we’ve seen, but also, frankly, in terms of the strengthening of our market position,” Pierre-Dimitri Gore-Coty, Uber’s senior vice president of delivery, reportedly told The Financial Times.
He added that Just Eat Takeaway is effectively “dominating” the German market despite its “extraordinarily high” commission rates, according to the report. “That translates into consumers and merchants actually being quite desperate for additional options,” he said.
Uber Eats takes a commission of up to 30% on each order, depending on the services that it provides.
Uber Eats hasn’t gone down well everywhere it’s been launched. The service was pulled from India last year and South Korea in 2019. Operations have also shut down or sold in parts of eastern Europe, South America and Africa.
Uber, which is hoping to reach profitability for the first time this year, said its food delivery couriers in Germany will be employed by fleet management companies that are contracted to Uber.
The company will pay the fleet management firms for each order they carry out and it’s up to them to decide how they pay their employees.
Britain’s Just Eat and the Netherland’s Takeaway.com announced they were planning to merge in July 2019 as part of a £9 billion (dollar conversion) deal.
Others have tried and failed to go up against Just Eat Takeaway in Germany including U.K.-headquartered Deliveroo, which pulled out of Germany in 2019 to focus on other markets.
Last June, Just Eat Takeaway, one of the largest food delivery businesses in the world, announced plans to merge with Grubhub in the U.S. after Grubhub’s talks with Uber fell through.