Careem delivery pivot helps offset pandemic losses

DUBAI: The coronavirus pandemic has created a challenging new reality for the ride hailing sector, according to the general manager of Careem in Saudi Arabia.

Hashim Larry said the pandemic triggered a switch by many drivers, known by the company as “captains,” into delivery service.

“Some continue to work on the delivery services even after the curfew ended after they saw a good return out of it” he said.

Saudis working in the delivery app space received financial support of up to SR3,000 ($800) per month in April and May.

“Corona has imposed a new reality on all of us, especially our sector, because our role was to take people outside their houses to wherever they wanted to go,” he said. “With COVID-19 our responsibility became to help people stay at home,” he said.

In order to meet that need to stay at home, Careem shifted focus from the core business of passenger transport to food and customer-to-customer delivery.

Although that shift has not compensated for the top line losses from the core business, Larry said focusing on these services “in the long term will pay back”.

Ensuring the safety of both drivers and customers was an additional challenge for Careem. The company set strict measures to limit the potential for the virus to be spread during a journey.

Among these is a new product called “Taxi Plus,” which consists of a fleet of cars supplied with a plastic barrier to separate drivers and riders.

The company is continuing to invest in its all-in-one platform, “Super App,” which was launched in June at a cost of $50 million.

Larry said that Careem’s initial strategy of opening offices across the Kingdom was important in its initial stages of growth, but now with adoption of more online solutions the direction will be more toward centralization. 

“Now we see a merit in centralization that will make the lives of our captains easier,” he said.

Uber completed the $3.1 billion acquisition of Careem in January.