Delivery Hero Leaves German Cities and Japan, Citing Competition, Driver Shortages

Delivery Hero’s Foodpanda unit will exit six German cities — Cologne, Düsseldorf, Frankfurt, Hamburg, Munich and Stuttgart — and sell its Japanese Foodpanda division in the first quarter of next year.

The move by Delivery Hero is a major victory for Just Eat Takeaway.com, which has a large footprint in Germany. Just Eat Takeaway.com acquired Delivery Hero’s local operations in 2018.

Headquartered in Berlin, Delivery Hero returned to its home market in May and launched in Japan in September 2020. External factors like increased competition and a shortage of riders prompted Delivery Hero to face a “new reality” as 2021 started winding down. It will continue operations in central Berlin, via an innovation hub to test new features and technology.

See also: Delivery Hero Plans German Expansion This Fall

“Scaling down our operations in Germany and planning to divest our Japanese business have not been easy decisions. Facing a very different reality now than we did entering these markets, it is with a heavy heart that we need to pursue other growth opportunities with larger potential,” Niklas Östberg, CEO and co-founder of Delivery Hero, said in a press release.

“Despite having built up two fantastic Foodpanda teams showing great progress, it has become increasingly difficult to create true value for our ecosystem in these countries,” Östberg added.

Despite winding down operations in Germany and Japan, Delivery Hero is pivoting to opportunities in quick commerce as well as other new markets and verticals.

Read more: Delivery Hero Buys Stake In Rival Deliveroo

Launched as a food delivery service in 2011, Delivery Hero operates in approximately 50 countries across Asia, Europe, Latin America, the Middle East and North Africa The company also has a hand in quick commerce and aims to deliver groceries and household goods in less than one hour and often in 10 to 15 minutes.

Delivery Hero has been listed on the Frankfurt stock exchange since 2017 and became part of the leading index DAX (Deutscher Aktienindex) in 2020.