Uber to scrap leasing business in US?

Uber's car-leasing subsidiary, Xchange Leasing, was looking into ways of cutting mounting costs, Reuters reported Tuesday. It said the company was also considering selling the whole division.

The Xchange Leasing business has about 40,000 vehicles and 14 showrooms in the United States and has already attracted interest from some buyers.

Reuters added that other options included a partnership or winding down the unit by reducing its presence in a number of cities.

Miscalculations

Either way, layoffs seemed almost certain, a source familiar with the matter said.

The Wall Street Journal reported earlier on Tuesday that as many as 500 jobs could be affected by any cost-cutting program, representing about 3 percent of Uber's total workforce.

Xchange Leasing has been around since 2015. It has supported drivers who have lacked the cash to buy vehicles.

But the intensive use of the leased cars has turned into a major problem for the company despite the relatively high leasing rates in place.

The winding-down plan comes after Uber's executives were informed that losses included $9,000 (7,650 euros) per leased car on average, steeply above previous estimates of around $500 per car.

hg/jd (Reuters, dpa)