Uber Eats will launch Berlin in the next few weeks in a bid to weaken rival Just Eat takeaway.com’s stranglehold on the German food delivery market, making its biggest entry to a new country since 2018.
Uber operates in 13 cities in Germany and the country is one of Uber’s fastest growing markets in ride-hailing, the company’s senior vice president of delivery Pierre-Dimitri Gore-Coty told the Financial Times, describing it as a “strategically important country”.
Nearly 25 million people used Uber Eats from over 126,000 restaurants in Europe last year, using 370,000 couriers.
“Europe in particular has been a bright spot for [Uber Eats], both in terms of some of the growth we’ve seen, but also, frankly, in terms of the strengthening of our market position,” Pierre-Dimitri Gore-Coty said.
“You have one player that is effectively dominating that country” he said, noting Just Eat’s “extraordinarily high” commission rates.
“That translates into consumers and merchants actually being quite desperate for additional options.”
The delivery couriers will be hired by fleet management companies who are contracted by Uber with the delivery company paying its German partners for each order.
A similar model was already put in place at its food delivery business in Geneva after a court case in September last year, but Germany is important in the company’s mission to aim for group profitability for the first time this year.
Uber Eat’s main rival Just Eat is in talks to acquire US food delivery company Grubhub later this year, edging into Uber’s home market for the first time.
Just Eat has dominated the German market since competitor Deliveroo withdrew from the country in 2019, leaving a lack of competition.
“If I judge by the experience we have in places like Spain or even in smaller countries like Netherlands or Belgium [Two of Just Eat’s largest markets], I’m pretty convinced that this will translate into actually very rapid growth for Uber.” Gore-Coty added.
The German market has become one of Just Eat’s biggest sources of profit meanwhile, company continues to strengthen its hold in the UK, investing heavily in its own in-house delivery network, Scoober.
The UK’s food delivery market has been volatile with Deliveroo and Uber Eats battling to secure partnerships with leading grocers to gain market shares.
Both of which have recently expanded partnerships with supermarket giant Sainsbury’s as the rapid-delivery grocery market gains popularity.