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The head of Uber’s (UBER) trucking arm expects to sustain triple digit revenue growth, amid an aggressive expansion across the U.S. and Europe, he recently told Yahoo Finance.
Uber Freight connects shipping companies with truck drivers, much like the popular ride-hailing app. Since launching in May 2017, it has been scaling up aggressively, expanding from its regional operations in Texas to the rest of the U.S. in March, as well as select markets in Europe.
Lior Ron said Uber Freight was still in the early stages of tackling a trucking industry that is “driving the economy of the United States,” the executive told Yahoo Finance’s “The Ticker” in an interview.
“This is a very sticky [business to business] enterprise revenue stream that is compounding as we go deeper into the logistics spend of those shippers, and on-boarding new enterprise shippers onto the platform,” Ron said.
Uber Freight has been a rare bright spot for the ride-hailing company in an otherwise bumpy ride since its IPO earlier this year. Uber posted a $5.2 billion loss in its most recent quarter, though much of that was tied to one-time stock-based compensation payments stepping from the listing.
While the company does not break out the business unit’s numbers, its “Other Bets”—which consists primarily of Uber Freight—saw revenue grow 175% year-on-year to $195 million in its most recent quarter.
CEO Dara Khosrowshahi said top line growth for the logistics unit surpassed 150%.
“This is basically a market that is a huge part of the global economy,” Ron told Yahoo Finance, citing the industry’s size in relation to U.S. and global economy.
“We have now the platform, we have the brand and we earned the trust of both sides of the marketplace and as we scale, we have critical density of truck drivers in every freight corridor across the U.S.,” he added.
Earlier this week, Uber Freight launched a revamped mobile app and web-based desktop portal, making it easier for fleet dispatchers to expand capacity and bring larger enterprise customers into the mix.
Uber Freight’s growth has coincided with a growing truck driver shortage in the U.S., stemming from an aging population. Last year alone, the driver deficit ballooned from 10,000 to 60,800, compared to the previous year, according to numbers from the American Trucking Association.
Uber and Seattle-based Convoy have moved to fill the void, by connecting small and medium-sized shippers with their network of carriers and drivers.
So far, Uber Freight has contracted with more than 36,000 carriers and over 1,000 shippers, including Anheuser-Busch InBev, Land O’Lakes, and Colgate-Palmolive, according to the company’s S-1 filing.
“We’re seeing a lot of strong traction because for all of them this is a way to connect with those big shippers that are looking for better ways to find drivers and manage the logistics,” Ron said.
Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter at @AkikoFujita
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