Changes at Uber Include CEO's Resignation, Driver Tips, and Higher Fares for Obnoxious Teens

Matt Posky
by Matt Posky

Uber’s founder is stepping away from the company — not for the summer, as originally planned, but for good. CEO Travis Kalanick has resigned after a relentless string of controversies caused the company to lose face for all of 2017 thus far.

On Tuesday, five of Uber’s largest investors demanded that the chief executive resign. This was followed by Kalanick’s official confirmation and a posting from the company’s head of U.S. operations outlining a 180 day strategy to turn things around. While the plan made no mention of Travis’ departure, the resignation certainly seems to jibe with its objectives.

Other more official aspects of Uber’s cleverly named “180” include trials for driver tipping in several major cities and a surcharge for teenagers because everyone hates them. The ride-hailing firm is also adding Driver Injury Protection Insurance and a way to bill passengers for making them wait. None of these changes appear to be all-inclusive, however. Uber has also made it fairly vague as to when and where some of these changes will occur.

Less uncertain is Kalanick’s departure. In a letter obtained by The New York Times, investors told the CEO to leave immediately while citing a dire need to change the company’s leadership.

“I love Uber more than anything in the world and at this difficult moment in my personal life I have accepted the investors request to step aside so that Uber can go back to building rather than be distracted with another fight,” Kalanick said in a announcement on Tuesday evening.

The board later released its own statement. “This is a bold decision and a sign of his devotion and love for Uber,” it explained. “By stepping away, he’s taking the time to heal from his personal tragedy while giving the company room to fully embrace this new chapter in Uber’s history.”

Last week, Kalanick said he would take an indefinite leave of absence from Uber, to develop “Travis 2.0” and to grieve for his mother, who died last month in a boating accident. That plan also mentioned he might someday return in a less public role at the company — which could have been beneficial considering its massive shortage of executives. However, Kalanick has served as the face of controversy and been charged with allowing the development of a toxic corporate culture. There have been rampant allegations of sexual misconduct at Uber, legal issues surrounding IP theft, unseamly programs like Project Greyball, conflict with government regulators, and a general encouragement of a dog-eat-dog mentality among staff.

Kalanick’s resignation leaves questions of who is going to take the helm at Uber, especially since the company is undergoing massive changes to turn its bad press into something positive. “There really is no top brass at Uber,” James Cakmak, an analyst with Monness, Crespi, Hardt & Co, wrote in an investor note last week.

Despite all the negative attention, Uber is still valued at nearly $69 billion. Revenue increased to $3.4 billion in the first quarter, while losses narrowed slightly — hinting that it might someday be profitable. Kalanick himself remains a billionaire due to his large stake in the company, with a net worth of roughly $6.7 billion. He also still retains majority control of Uber’s voting shares.

[Image: TechCrunch/ Flickr (CC BY 2.0)]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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6 of 24 comments
  • TomHend TomHend on Jun 21, 2017

    Bigger news is Uber just allowed tipping and since the drivers rate the riders, if you do not tip enough you will get a bad rating which will be seen by other drivers and they will stop picking you up, this will eventually raise the price of using Uber and probably very bad for Uber in the long run.

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    • JimZ JimZ on Jun 22, 2017

      @IHateCars that's what they want you to believe, but it's horses**t. They're a taxi company.

  • Frank Mansfield Frank Mansfield on Jun 22, 2017

    As the late Phyllis Schlafly correctly noted: "a virtuous woman can not be sexually harassed". This is a matter of fact, not opinion. Uber is doomed unless they successfully implement the traditional taxi business model of using government to grant them a monopoly.I hope they fail.

  • NotMyCircusNotMyMonkeys dudes off the rails on drugs and full of hate and retribution. so is musky.
  • Big Al from Oz Musk and Trump are of the same ilk, except Musk's IQ is a damn site higher than Trumps. Musk like Trump is only into himself. Musk doesn't care about Trump only Musk. Musk sees more dollars if Trump wins.Hey, I'm Big Al again!3
  • Rover Sig We have a car with two fake exhausts in the bumper, but a large shiny muffler visible hanging down on one side, not aligned with the fake exhaust exits. Horrendous. I had to paint the shiny muffler with high-temp black paint to make it less visible. Exhaust pipes were meant to be round and hang below the bumper, and they can be made quiet or loud as the engineers like. But fake exhausts rank down there with fake intake vents on the side of that old Buick.
  • EBFlex Of course it does. What a silly question
  • Buickman Elon is a phony.