FREE NOW: The BMW-Daimler ride-hailing venture Uber might be acquiring
Gone are the days of flagging down taxis to make sure you get a ride home. Because now there is an app — or, rather, several apps — for that.
Having launched in San Francisco in 2009 (and then reaching South African shores a few years later in 2013), the ride-hailing app Uber, which was the brainchild of Garrett Camp and Travis Kalanick, now has 75 million active users worldwide, over three million drivers, is available in 80 countries and has an impressive global market value of over R1 trillion ($72 billion). While there are a handful of popular competitors on the scene, such as Lyft and Bolt, none of them come close to this industry giant when it comes to market (and world) domination, nor will they bear the legacy of having been the ride-hailing app that set the bar for all who did and will follow in their innovative footsteps.
While Uber has, undoubtedly, changed the way many people get from A to B for the better, their launch didn’t come without its fair share of backlash. Taxi drivers around the world protested as the app was launched in their respective countries, resulting in an enormous decline in business. The reason that people were so easily converted to Uber was because of its disruptive technology, which made for a safer and more convenient service for drivers and riders, which has since expanded to include luxury transportation and food deliveries as well. And they might be expanding even more in the near future because they have shown interest in purchasing a ride-hailing joint venture by Daimler AG and BMW AG in the attempt to get an even stronger foothold in the European and Latin American markets.
One would assume that global automotive conglomerates would have a vested interest in having people buy their own personal vehicles rather than encouraging them to forego them in favour of ride-hailing apps. But, clearly, BMW AG and Daimler AG are seeing the impact of technology on the present and future of transportation, which is why they joined forces on a venture to, as they say, ‘reinvent mobility as we know it.’
The result? The FREE NOW group, which consists of ride-hailing apps FREE NOW (available in nine European countries), beat (Greece, Peru, Chile, Colombia and Mexico), Kapten (France, UK, Portugal and Switzerland) and Clever (Romania). They boast over 21 million users across their countries of operation, having shown enough market success to have piqued the interest of Uber Technologies Inc. who, just this year, indicated that they were interested in potentially acquiring this joint venture, which would greatly boost its market share Latin America and Europe. This came about after, despite high hopes and a promising reception, FREE NOW was unsuccessful in attracting additional investors or gaining significant traction due to the onset of the COVID-19 pandemic.
According to Daimler, this joint venture aimed to focus on mobility services with BMW that respond to the mobility needs of the present and the future, with a major emphasis on digitalisation. They collectively invested roughly €1 billion into this project, which resulted in the birth of the NOW Group under which FREE NOW and their other mobility initiatives, such as PARK NOW and SHARE NOW, live. They said that ‘over time, customers will be able to use and experience additional mobility options from all-electric autonomous fleets that are available on-demand, charge and park themselves, and connect with other modes of transport beyond road and rail.’
And, just because they have shown interest in selling doesn’t mean that this joint venture wasn’t a successful or profitable one. Through strategic integration with smaller ride-hailing companies, they managed to expand to cover over 100 European countries, making them legitimate competition that even a giant like Uber can’t ignore. In June, Daimler valued its share in the operations as being in the region of €610 million which indicates that, despite the initial coronavirus-related hurdles, FREE NOW was still managing to disrupt the market with their new mobility-service offerings.
While their plans might be future-focused, without the capital, reputation and market stronghold that Uber has managed to earn since it revolutionised the ride-hailing industry 11 years ago, there is a good chance that they could soon become yet another startup acquired by Uber Technologies Inc., making this market-dominating beast even bigger and even more powerful, especially when it comes to sniffing (and buying) out any businesses that threaten their position.
