The growth of Uber will be hindered if drivers purchase fewer cars than the firm anticipates during a specific time period and in a specific market. The Silicon Valley-based ride-hailing app started early financing cars for those who are interested in driving for the company to avoid the slow growth. According to rumors, the driver’s weekly salary will be withheld to pay the car’s installment.
Uber anticipates that by the end of 2016, the number will increase to 150,000 from the over 50,000 drivers who received cars under the program in 2015.
The financing for the vehicles came from its subsidiary Xchange Leasing. It has the ability to provide Uber drivers with a $1 billion credit line for the purchase of cars.
In the interim, it is also known that the corporation is testing a program called Advance Pay, under which the drivers can take out a $1,000 loan without paying interest and repay it with their profits. Uber and financing startup Clearbanc have partnered to make it accessible.
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It should be noted that Clearbanc’s interest rates for additional loans to drivers may be high.
Since its founding almost six years ago, Uber has grown quickly in the global market despite facing opposition from taxi associations and regulators. It has operations in more than 60 countries and is currently Silicon Valley’s most valuable private corporation. It is currently valued at $68 billion.
As Uber expands into additional markets, we might see at least a dozen more marketing strategies from the company. In the comment section below, please share your thoughts with other readers.