Uber has confirmed to TechCrunch that it will shut down its Xchange Leasing subsidiary, which provided vehicle leases to drivers on the service that couldn’t otherwise procure vehicles through traditional financing options.
The shutdown wasn’t unexpected – Uber said in August that it was working on what to do with the business, after reports emerged that it was considering a shutdown. Uber at the time decided together with its board that it was resulting in “sustainably high losses,” per a Wall Street Journal report.
Today’s shutdown was reported first by the Wall Street Journal, and confirmed to TechCrunch via a spokesperson, who provided the following statement from the company:
“We have decided to stop operating Xchange Leasing and move towards a less capital-intensive approach.”
The Xchange Leasing shutdown will affect around 500 jobs, per the Journal, and indicates that the company ultimately wasn’t able to find a better solution regarding what it should do with its leasing business.
Uber has also partnered with other companies on making cars available to drivers on shorter term, no commitment bases, including providers like GM’s Maven, so that could be something it focuses more on in future to make vehicles available to drivers without their own cars.