Uber has struck an agreement to sell its maligned auto leasing business, Xchange Leasing, to Fair.com, a startup car marketplace.
Formerly a program designed to provide Uber's drivers with leased vehicles through partner car dealerships, Xchange Leasing sort of fell apart.
Trying to peddle Ford Focuses, Nissan Altimas, and similar class vehicles, it quickly met resistance on the market. According to a Wall Street Journal report, Uber faced an average loss per vehicle estimated at around $9,000 per car.
This figure was 18 times more than initially anticipated. As a result, 500 employees, or 3 percent of Uber's workforce, are expected to be affected, mainly in its Los Angeles and Atlanta offices.
The sale to Fair.com is one of the more substantial publicized moves by new CEO Dana Khosrowshahi to introduce more cost-cutting discipline at the company, which has faced headwinds in the past for poor spending.
As for the vehicles, many have already been auctioned off.
Fair.com helps connect customers with cars on a lease model, with monthly payments lasting as long as seven years. According to its website, it "offers an entirely new digital alternative to a loan or lease" , promising monthly payments lower than traditional loans or leases.
Here's a good explanation of how Fair.com works.
Fair.com owns all cars, as either pre-owned or certified pre-owned under six years old and 70,000 miles. Every plan comes with route maintenance coverage such as multi-point inspections, with customers assuming responsibility for vehicle upkeep.