Uber Freight evolved out of the passenger service in 2017, and its acquisition of Transplace for $2.25 initially followed its decentralized independent contractor business model. But by the end of 2022, Uber Freight leadership reportedly plans to change its penchant for autonomy and brand Transplace with the Uber Freight name in an effort to increase opportunities.
“This is a significant step forward, not just for Uber Freight but for the entire logistics ecosystem,” Head of Uber Freight Lior Ron reportedly stated at the time of the acquisition. “This is an opportunity to bring together complementary best-in-class technology solutions and operational excellence from two premier companies to create an industry-first shipper-to-carrier platform that will transform shippers’ entire supply chains, delivering operational resilience and reducing costs at a time when it matters most.”
Rather than continue to present different identities consistent with its founding organization, Uber Freight plans to integrate wide-reaching aspects of Transplace and essentially patch over the assets and logistical personnel it took on in July 2021. Centralizing the operation will likely streamline costs, reduce redundancy, and increase profitability. But the move indicates a change away from the initial model of hands-off transportation and logistics oversight across its many moving parts.
“All in all, we expect to significantly reduce shipper and carrier empty miles to the benefit of highway and road infrastructures and the environment,” Transplace CEO Frank McGuigan said at the time of the buyout.
Those benefits were apparently reason enough for Uber Freight decision-makers to go all-in on Transplace. Heightened competition for qualified CDL holders, rising fuel costs, and other industry challenges may have caused Uber Freight to revert to a more traditional model of centralizing its operation. However, all indications point to Uber Freight remaining within the Uber Technologies family.
Uber Freight boasts among the largest third-party logistics operations in North America. The Uber outsourcing model emerged in 2017, spun off as a separate wing in 2018, and quickly expanded into Canada, as well as Europe. The re-imagined Uber Freight will now function autonomously from the parent corporation.
Such changes are expected to open doors to more business-to-business opportunities for independent truckers. The complete integration of Transplace into Uber Freight may not send ripples across the third-party logistics industry. But coupled with the break away from centralized Uber oversight, the organization will likely present increased opportunities for owner-operators going forward.
Sources: techcrunch.com, freightwaves.com
Not enthused when I hear uber
All I think is dirt cheap rates
You can’t make it with uber freight rates . After looking at uber freight app
Hundreds of time , I don’t even consider them anymore, it’s almost makes me think they want to run owner operators out of business
I agree… their objective is to make $$$ for themselves and the heck with the o/o’s!
We’ve always had problems with central planning…..that’s been USDOTs issues trickling down to FMCSA.
Whatever we do …we’re still decentralized; and that’s good for profit, but not so good for the whole infrastructure.
USDOT/FMCSA have to work out infrastructure regulations…. before this industry becomes a real runaway train.
Read the writing on the wall carriers. This is a move to the bottom for freight rates!
Uber wasted tons of investment capital trying to build a service no one needs. Truckers are in business to make money. This is distinctly different from people that happen to own cars and are ok with being paid poor rates to operate as a taxi because, hey, the car is already budgeted for.
The only people using Uber freight are foreigners with a language barrier, poor people with no education trying to succeed in trucking, smart carriers that spot lanes or loads on the app that Uber are trying to scoop shippers by under charging the shipper and over paying the truck to secure 100% capacity service. This last segment of users is falling off. Uber has burned through huge piles of money to gain a foot hold in the freight markets.