Uber announced in March that it would hire hundreds of Chicago-area Uber Freight workers ahead of plans to lease additional city office space, and this morning the ride-hailing giant revealed its long-term vision for the newly christened Uber Freight HQ. Uber said it has signed a 10-year lease on the Old Main Post Office in the Chicago River district and that it intends to hire “thousands” of new employees in the region, substantially growing its current Chicago workforce of over 1,000.
The investment comes to $200 million collectively, according to Uber, which expects Uber Freight HQ will serve as one of its Freight business’ primary engineering hubs. In a press release, Uber said the commitment builds on its collaboration with the Chicago Cook Workforce Partnership (CCWP) to bolster corporate diversity and its ongoing Chicago investments, which it claims have funneled over $1 billion into the local economy (through driver earnings) over the last three years.
Uber says it will start onboarding roughly 2,000 new employees in 2020 and that it will work with CCWP to develop a process for identifying potential candidates through the latter’s system.
“Trucking represents an enormous opportunity for Uber, and this milestone is a testament to our long-term commitment to our Freight business,” said Uber CEO Dara Khosrowshahi. “Chicago is the heart of America’s transportation and logistics industry, and there is no better place to open our dedicated Freight HQ. Uber has long recognized the incredible history, innovation, and talent that Chicago has to offer, and we’re excited about the thousands of new jobs our Freight business will help bring as we become one of the city’s largest technology employers.”
Uber Freight, which launched in May 2017, is the company’s grab at the $8.1 trillion global logistics transport industry. Simply put, Uber Freight connects carriers and drivers with companies that need to move cargo, and it’s off to a promising start — Uber says Freight remains one of its “fastest-growing and most promising businesses.” Over the last 27 months, Freight has scaled to over 400,000 drivers across the U.S. and Europe (up from 30,000 carriers in February) and more than 1,000 shipping customers, including AB Inbev, Niagara Bottling, and Land O’Lakes.
“Since the beginning, the team at Uber Freight has been made up of the best and brightest minds in technology and logistics, with major talent hubs in San Francisco and Chicago,” said head of Uber Freight Lior Ron. “We are thrilled to deepen our investment in Chicago, which is known for its logistics expertise. We are excited to bring on board thousands of team members to help build the future of logistics — together with our growing list of customers — and to support the massive growth trajectory we see for Uber Freight in this industry.”
When a business schedules a delivery through the Uber Freight for shippers, they get prices upfront in the Uber Freight app. Customers are matched intelligently to carriers in Uber’s network and see a real-time, mutually agreed-upon quote that’s determined by market conditions and “other factors.” For recurring shipments, the recently introduced Lane Explorer feature leverages machine learning to assess dynamic factors and generate rates for each of the next 14 calendar days out.
Roughly 80% of all cargo in the United States is transported by the 7.1 million people who drive flatbed trailers, dry vans, and other heavy lifters for the country’s 1.3 million trucking companies. It’s an industry that’s forecast to grow 75% by 2026 — and one Uber wants to dominate.
Unfortunately for Uber, Freight’s got plenty in the way of competition. Seattle-based Convoy, which raised $185 million in September 2018 from the likes of Jeff Bezos and Bill Gates at a $1 billion valuation, boasts a platform — Dynamic Backup — that builds routing guides from real-time, guaranteed prices for contractual freight. And Transfix, which operates in New York, has an online marketplace that matches loads to drivers.
But Uber’s not giving up the fight. The company more than doubled its investment in Freight last August and has subsequently introduced new features, including Yelp-like ratings for shipping facilities.