Uber drops plans for flying taxi journeys

Uber has dropped plans to transport passengers across cities in air taxis, the second ambitious and expensive project it has pulled the plug on in as many days.

The taxi app said on Tuesday it had sold its Elevate division to Joby Aviation, a US start-up developing its own aircraft. Uber will also invest $75m (£56m) in the company.

Uber announced plans for an electric air taxi service in 2017, saying it expected tests to start taking place in 2020.  The company had said that over time, the cost of taking a flying taxi would be quicker and cheaper than ordering a car, and that flights would be available to the public in 2023.

However, Uber has come under increasing pressure to cut costs during the pandemic, which has seen ride numbers plummet. The news comes just a day after Uber said it would sell its driverless car arm to Aurora, a company that specialises in the technology. 

While both projects had promised to put Uber at the forefront of new modes of transport, the company had struggled to make progress against its ambitious deadlines, and technical and regulatory hurdles had threatened to get in the way.

Several companies are developing electric aircraft that take off and land vertically — often referred to as flying cars — but the technology remains at an experimental stage, not available to the public.

Announcing the deal, Uber’s chief executive Dara Khosrowshahi said he was still hopeful about the technology’s potential, and that the company would partner with Joby when its aircraft becomes available. Joby says its vehicles will be able to travel at up to 200 mph with a maximum range of 150 miles.

Air taxis are largely seen as a solution for dense cities where congestion slows down car journeys.

“Advanced air mobility has the potential to be exponentially positive for the environment and future generations,” Mr Khosrowshahi said. “We’re excited for their transformational mobility solution to become available to the millions of customers who rely on our platform.” 

Uber lost $8.5bn last year and has lost $5.8bn in the first nine months of this year. It has said it hopes to become profitable towards the end of next year.