Just Eat Takeaway shares fell as much as 5.4% in Amsterdam trading while Uber was up as much as 1.3% at 11:29 a.m. in New York.
In Germany, Uber said it believes there’s strong demand for more food delivery services and said it will start its expansion in Berlin. The company will contract out its delivery riders to third party suppliers, similar to the way its ride-hailing drivers operate, the company said.
The new market could provide an opportunity for Uber to expand into other kinds of delivery services, since Just Eat Takeaway only does restaurant food delivery, Bloomberg Intelligence analyst Mandeep Singh said in a note on Wednesday. Groen said last week that the company was running tests on grocery delivery, but that it would only add the service if it was neutral to gross profit.
“Expansion in Germany could aid take rates if the company can move beyond Uber Eats to offer other kind kinds of delivery services through partnerships with local merchants. While competition from DoorDash has hurt Uber’s share in the U.S., Europe’s sales contribution rose 500 bps to about 20% in 2020.” — Mandeep Singh, BI technology analyst
Drivers who want to pick up Uber drivers must first find a private-hire fleet to join. Uber has been battling regulators in the country for years and Khosrowshahi has called for changes in the laws regulating transportation.
Just Eat Takeaway’s approach to delivery may have left it “exposed” to competitors in Germany, with Uber and smaller delivery rival Wolt announcing plans to expand into the market in the last six months, Jefferies Financial Group analyst Giles Thorne said in a note on Wednesday. Rivals are “evidently reveling in how under-developed delivery is.”
Uber Eats is available in other European markets such as Spain, France, Poland and the U.K. The news was first reported by the Financial Times.