Uber Drivers to Get GM and Toyota Financing Deals

December 28, 2013 Leave a comment

Uber Drivers to Get GM and Toyota Financing Deals

People who sign up as drivers for Uber Technology Inc.’s car-booking service will be able to get discounted financing or leasing for vehicles made by Toyota Motor Corp. (7203) and General Motors Co. (GM)Drivers registered to pick up passengers, who request and pay for rides using Uber’s mobile application, will be able to go to a dealership and buy designated Toyota or GM cars approved for the program at lower rates through vehicle-financing companies, Uber Chief Executive Officer Travis Kalanick said in an interview.

Uber, based in San Francisco, is racing to keep up with demand as more people sign up and the company expands into new cities. Global usage in October increased more than 20 percent from the previous month, Kalanick said. Uber, which plans to discuss the financing program in a conference call today, is seeking to boost the supply of cars on its service while creating opportunities for automakers to sell vehicles, he said.

“We need to make strategic moves so that we can supply those cars onto the system,” Kalanick said. “The demand is there, but if we don’t get the cars on the road — if we don’t help our partners and drivers get cars on the road — then it just doesn’t matter. We’re just not going to be able to grow.”

Kalanick declined to name the banks or companies financing or underwriting leases for Toyota and GM cars. Uber raised $258 million from Google Inc. (GOOG)’s venture-capital arm and other investors earlier this year, valuing the company at $3.5 billion, Kalanick said. Uber plans to invest in research and development, and expand beyond the 60 cities where it currently operates.

Driver Pool

The auto-financing program will start on a trial basis for “thousands” of drivers, Kalanick said. Within a year, he aims to sell hundreds of thousands of cars through the program. Uber, which takes a cut of the fares booked through its system, said in April that it had “tens of thousands” of drivers.

In addition to finding people willing to drive, Uber is striving to maintain a level of quality among drivers, who are rated by passengers through the app. Drivers are required to take a “city knowledge test,” and Uber is exploring other ways to help its road warriors, including integrated turn-by-turn directions, Kalanick said.

Founded in 2009, Uber competes with several apps that let users book rides, including Hailo, GetTaxi, Lyft, SideCar and Mytaxi.

To contact the reporter on this story: Mark Milian in San Francisco at mmilian@bloomberg.net

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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