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UBER has bought nine-year-old Australian car-sharing service Car Next Door, in which South Korean car maker Hyundai has a stake, to expand its car offerings to customers wanting short-term, temporary use of a vehicle.

The purchase, for an undisclosed amount, was announced by Uber Australia and New Zealand general manager Dom Taylor and Car Next Door founder and CEO Will Davies.

Under the deal, Car Next Door will retain its independence but report to Uber. A Financial Review report said that the car-share business was valued “at up to $50 million” when it raised $5 million from investors in 2018.

Will Davies

As part of a $10 million capital raising, it subsequently welcomed Hyundai as a shareholder after the South Korean car-maker injected $A8.2 million into the business, starting with a $2 million investment in early 2019 and then $6.2 million in September 2019.

In a statement, Uber said Car Next Door would allow customers another option for trips that were less suited to conventional single Uber rideshare journeys, including running errands or a day trip away.

Car Next Door uses a community of 50,000 members who are prepared, for a fee, to share their car when it’s not in use.

The business uses an online platform for members to list their cars, while customers link via the platform and get the car keys via a lockbox attached to the outside of the car.

It is based on studies showing that half of Australian households have two or more cars and that more than 70 per cent of trips in Australia occur in private cars.

Its research states that since 2002, car registrations in Australia have increased from 10 million to more than 15 million. However, the distance travelled has fallen by 2.5 million kilometres annually.

Uber’s Mr Taylor said: “This year marks 10 years since both Uber and Car Next Door launched in Australia.

“A lot has changed in that time but one thing has stayed constant is a shared vision that we need to make transport not just safe, convenient, and affordable –but also sustainable.

“What our app users haven’t had … is the option for those mid-range and longer-distance trips. 

“This deal will change that, and mean that the Uber platform can be a reliable and convenient alternative to the choice to own a car.”

Car Next Door’s Mr Davies said: “By working with Uber we can scale up our ambitions and look to move Australians away from the over-reliance on the private car which is damaging our planet and making our cities less liveable.”

It is the third major deal for Uber in less than 18 months. It bought North America’s biggest e-commerce alcohol marketplace Drizly in February 2021 for $A1.5 billion and then food delivery service Postmates in November 2020 for $A3.67 billion.

By Neil Dowling

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