The trucking industry generated $796 billion in revenue last year, while the global ride-hailing market was valued at just $36 billion in 2017. And since its launch in 2017, Uber Freight now has a team of hundreds, with offices in San Francisco, Chicago and Amsterdam.
In July, the company announced it was going after its second European market with the launch of its trucking platform in Germany. The move puts Uber in direct competition with local startups like Berlin-based Sennder and the U.K.’s Zencargo and FreightHub.
“I think Uber senses that the logistics industry has a lot of growth potential,” said Michael Ramsey, a senior research director at Gartner, according to CNBC. “It already has grown quite significantly since the dawn of the package delivery boom with Amazon at its heart.”
Shipping companies usually have freight brokers act as middle men to match them with available truckers, but Uber Freight removes this step, allowing drivers to choose from a list of available jobs and the routes needed to complete them.
“People who [are] on the supply side, if they’re truckers who want to operate their own business or want to get outside, have more flexibility in the same way that Uber drivers do as cab drivers,” Ramsey said. “They can use that platform to have a lot of flexibility and run their own business. And then on the demand side, the people who wouldn’t otherwise ship things have access into that market a little bit more easily.”
Just last week, Uber Freight announced that it is investing $200 million to “put down roots” in Chicago.
“Chicago is consistently at the forefront of innovation, from building America’s foundational transportation systems and its first skyscraper, to fostering world-class universities and research centers,” Lior Ron, head of Uber Freight, wrote in a blog post. “The city has always been at the heart of the global transportation industry, and we’re eager to continue that legacy.”
Ron noted that the expansion into Chicago “is a testament to Uber’s long-term commitment to transforming the way goods move with Uber Freight. Alongside Eats and Rides, Uber Freight is constantly looking towards the next frontier — working to redefine what’s possible so that we can have the biggest impact on the people that keep our economy moving.”