Uber Technologies plans to continue investing aggressively in Southeast Asia even though the ride-hailing company expects to lose money in the market for some time amid intense competition.
“We expect to lose money in Southeast Asia and expect to invest aggressively in terms of marketing, subsidies, etc,” Uber’s CEO Dara Khosrowshahi said on Thursday, according to Reuters.
“From a competitive standpoint we think we can improve,” Khosrowshahi was quoted as telling reporters in New Delhi.
On his first official visit to Asia since he became Uber CEO last year, Khosrowshahi said there is huge potential in the region thanks to a big population and fast internet user growth.
He said that a decade from now he expects 80 percent of growth at Uber to be organic and some through acquisitions.
“We will look at anything …. But right now the plan for Southeast Asia is to go forward, lean forward and to invest.”
SoftBank’s 15 percent stake purchase in Uber last month has opened up the possibility of combining Uber with other ride-hailing assets the Japanese group owns across Asia, which include stakes in Singapore-based Grab and India’s Ola.
CNBC reported earlier this month, citing unidentified sources, that Uber may be preparing to sell its Southeast Asia ride-hailing business to rival Grab in return for a substantial stake in the company.
But Khosrowshahi seemed to dismiss that strategy on Thursday, according to the Reuters report.
SoftBank is an investor but Uber will take any final decisions along with the board on mergers and partnerships, he said.
Khosrowshahi said he does not expect any change in Uber’s India operations following the deal with SoftBank.
India is one of Uber’s fastest-growing international markets and accounts for more than 10 percent of Uber’s trips globally, but it’s not making money yet, he said.
“The greatest value that we can create here is to continue to invest and grow our business here, not just for India but the role it is going to play in shaping our product for the rest of the world,” Khosrowshahi said.
Uber and India’s market leader Ola have been locked in a fierce battle, pumping in millions of dollars of investors’ money for a bigger piece of the country’s US$12 billion taxi market.
Khosrowshahi declined to comment on specific investments for India but said “it is a lot” and will continue to increase.
“We should actively be investing in markets like India and Latin America that have huge growth ahead of us,” he said.
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