Uber is ready to sell off its two-year-old Xchange leasing program, according to multiple reports. Earlier in 2017, Uber announced it was planning on ending the program due to heavy losses. While the company had previously estimated losses averaging nearly $500 per car, new revelations place that figure closer to $9,000.
On every car.
Leasing specialist Fair is set to purchase the program, though the price is yet to be announced. The Wall Street Journal, citing anonymous sources with knowledge of the deal, said Uber will acquire a stake in Fair. It will also offer its drivers access to Fair’s leasing network, which pairs drivers with vehicles within their price range.
Uber started its Xchange program in 2015, ostensibly with the aim of increasing its pool of drivers by leasing cars to those who wouldn’t otherwise be able to afford one. The program’s key features include low down payments and weekly car payments deducted directly from the drivers’ Uber paychecks. With a business model largely dependant on borrowers with subprime credit, Xchange has come under fire for what some describe as predatory lending tactics.
Xchange is not Fair’s first attempt at purchasing a marketplace network. Last year, it attempted to purchase online marketplace Beepi, and earlier this year Fair raised over a billion dollars in a round of funding that included BMW’s iVentures, Mercedes-Benz, and Penske Automotive Group.