March 21, 2019

Uber Freight expands brokerage service to Europe

Uber Freight expands brokerage service to Europe

Firm plans to launch service in the Netherlands, then expand in the E.U.

By DC Velocity Staff

Uber Freight, the freight brokerage arm of ride-hailing firm Uber Technologies Inc., plans to extend its operations into Europe beginning with a launch in the Netherlands "in the coming weeks" and expanding to additional countries in the near future, the company said in a blog post Wednesday.

The move is San Francisco-based Uber Freight's latest growth spurt following its parent company's 2018 pledge to double its investment in the division and operate it as a standalone business. Also in recent months, the company launched a "lane explorer" predictive pricing tool for shippers, a freight matching platform for shippers, and a "facility ratings" feature for drivers.

Uber Freight did not say exactly when its Dutch operations would begin, but the company is already hiring. On Thursday its job board listed a number of open positions in an "Uber Freight EU" office located in Amsterdam, including account executives, account managers, a business operations lead, a manager of carrier sales, operations coordinators, and pricing managers.

At a basic level, the company plans to follow the same business strategy in Europe that it has in the U.S. "As we did during Uber Freight's early days in the U.S., we will operate as a manual freight forwarder and increase app adoption over time," the firm said in a "frequently asked questions" addendum to its blog post. "Using the platform comes at no cost to shippers and carriers. There are no fixed prices or fixed service fees. Uber keeps the difference between the buy and sell price."

Despite the sophistication of the European freight market, carriers and shippers there experience many of the same challenges as their counterparts in the U.S., the company said. "For example, the European trucking market is experiencing a severe shortage of drivers, and of the time drivers are on the road, 21 percent of total kilometers traveled are empty. Inefficiency of this scale results in shippers struggling to find available drivers to move their goods," Lior Ron, head of Uber Freight, said in a release.

In addition, the European market is highly fragmented, with small- to medium-sized carriers making up more than 85 percent of the total carrier pool and struggling to meet the needs of shippers without the aid of technology, the company said.

To address those challenges, Uber Freight will operate under Dutch law as a freight forwarder (expediteur), connecting shippers that want to ship their goods to carriers that comply with applicable rules, the company said. "The European truckload market is a $400 billion marketplace and is the third-largest in the world after China and the United States, yet it still takes dispatchers and drivers multiple hours —  sometimes even days — of administrative work to book a single load," Ron said. "When you combine these shortcomings in the market, the price of goods goes up. A more efficient and transparent freight marketplace is something Uber Freight can bring to the table that will pay dividends to all, as well as reduce wasted miles and fuel."

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