New Uber CEO Faces Task of What to Do With Leasing Unit

Uber has chosen Dara Khosrowshahi to serve as its chief executive, according to numerous sources, capping off many months of scandals and struggles within the rideshare company.

Uber is expected to make a formal announcement by today.

The decision occurred Sunday afternoon, according to multiple reports, with Khosrowshahi among Meg Whitman, chief executive of Hewlett-Packard Enterprises, and Jeffrey Immelt, the former chief executive of General Electric, as choices.

Khosrowshahi — the current CEO of Expedia — will take on the task of repairing frayed relations among investors, rebuilding employee morale, and creating a profitable business after seven years of losses. One source of revenue loss for the company has been Xchange Leasing, its subprime car leasing program for Uber drivers, which the company is considering selling or consolidating.

Khosrowshahi’s plans for the program is unknown at this time. Uber did not respond to a request for comment.

Xchange Leasing — which debuted in July 2015 as a way to help provide vehicles to potential drivers — was also an initiative to encourage drivers to stay on the platform in order to pay off the lease. There are currently 40,000 vehicles and 14 showrooms in the U.S. alone, a source familiar with the program told Auto Finance News earlier this month. The decision to reduce or sell the program was initiated when Uber executives were informed that losses were significantly higher than previous estimates, according to a published report.

Khosrowshahi has been president and chief executive of Expedia since 2005, which is a publicly traded company with a market capitalization of around $23 billion, compared with Uber’s private valuation of nearly $70 billion. During his time at Expedia, revenue increased to $8.7 billion in 2016, from $2.1 billion in 2005.

Travis Kalanick, Uber’s founder and former CEO, was ousted in June following a revolt from the board. One of Uber’s largest shareholders, Benchmark Capital, is also now suing Kalanick, claiming that he has not respected the terms of his resignation and has tried to usurp the board to make an eventual return as CEO. Since then, board members had been split over candidates; Kalanick, who maintains a board position, favored Immelt while Benchmark, whose partner Matt Cohler sits on Uber’s board, preferred Whitman, according to a published report.

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