Daimler sets its sights on Uber with a 60% stake in rival firm Hailo
Published Date: 27th Jul 2016
The current market dominance of the app based taxi service Uber is under threat yet again, this time by a German car manufacturer’s parent company.
The German based brand plan to rival Uber by merging the resources Hailo has and rebrand the company into its own app based, on demand service, My Taxi. The merger will help My Taxi expand its reach and market share as Hailo currently operate in the UK, Ireland and Spain where My Taxi has no operations.
It is indeed a very strategic move as My Taxi operates in Austria, Germany, Italy and Poland where Hailo has very limited presence. The merger involves no cash being exchanged, but on the basis that Daimler will inject millions of Euros into the business to expand current market share and invest into new territories.
This will make it one of the biggest European companies in the field. They still have a long way to match the global dominance that Uber have, at this moment in time.
Car manufacturers like Daimler and Mercedes-Benz investing in the future of smart-phone app, ride sharing and private taxis is not a new thing. Other rivals such as General Motors have a stake in US group Lyft and VW group has invested in the Isreali app Gett. BMW and Jaguar Land Rover are already heavily involved in the market. Toyota has also made an undisclosed investment in Uber.
Hailo past, present and future
Hailo that launched in 2011 have just 75 staff at its UK-based headquarters, but Daimler will move most of the firm over to Germany. Their existence has had its troubles in the past posting pre tax a pre tax loss of £10 milllion in 2014 and pulling out of Canada and the US in 2014 due to complete unprofitability, mainly caused by the market dominance of Uber and Lyft.
Current investors include Accel, Wellington Partners and Sir Richard Branson. The complete rebranding is set to be complete by the middle of 2017.
Former Carphone Warehouse executive Andrew Pinnington, who will take charge of My Taxi, said “By combining Hailo and My Taxi, we have created the largest European taxi e-Hailing company. We bring together world class technology, an iconic brand, high quality people and the financial backing of our shareholders.”