Uber-backed ride hailing service Careem announced on Tuesday an end to its operations in Qatar.
The surprise announcement, which went into effect immediately on Feb. 28, comes just months after the country became the first Middle Eastern nation to host the World Cup. Careem played a key role in Qatar’s 2022 World Cup, expanding its fleet in the country by 50% in November, while growing in neighboring Saudi Arabia and the UAE.
Careem also for the first time offered inter-country round-trip rides from Saudi Arabia and the UAE to Qatar for the soccer tournament, which allowed customers to travel to matches by car across the Gulf.
Uber, which bought Middle East rival Careem in 2019 for $3.1 billion, told CNBC it will be operating “business as usual” in Qatar following today’s announcement. While Uber Technologies has full ownership of subsidiary Careem, the two companies operate independently. Careem’s focus on its “Super App” differentiates it from the American ride-hailing giant, which is focused on mobility.
Despite Uber’s 2019 acquisition of Careem, the ride-hailing app’s business in Qatar is not owned by Uber, which was subject after the deal to local acquisition laws.
“Uber sought regulatory clearance from certain local competition authorities (including in Qatar) to acquire Careem in 2019. While regulatory approvals in other countries were obtained, unfortunately, this did not happen in Qatar,” Uber told CNBC.
Careem told CNBC it “will no longer provide ride hailing services in the country as of 28 February 2023.” It added that “Careem is proud to have served customers and captains in Qatar and to have contributed to the growth of the Qatari economy.” Captains are the drivers hired by Careem.
Qatar’s capital city Doha was the first market Careem expanded into in 2013, after its start in the United Arab Emirates.
Dubai-based Careem, which in other markets across the region offers its “Super App,” initially ran a ride-only platform in Qatar, but launched food delivery in Qatar last February. The “Super App,” which is used by customers in neighboring UAE and Saudi Arabia, offers food delivery, groceries, cleaning services and bike rentals as well as electronic payments.
Careem operates in over 80 cities and 10 countries, according to its website. Established in 2012 in Dubai by co-founder and CEO Mudassir Sheikha, the company grew from a Dubai-based ride sharing company to a “Super App” platform, used across the Middle East from Morocco to Pakistan. For many women in the Middle East, the company played a game-changing role; Careem pushed to hire female “captains” in Saudi Arabia when it became legal for women to drive in 2018.
CNBC has reached out to the Qatari Government for comment on Careem’s announcement.
Source : CNBC