Why Uber CEO Travis Kalanick had to resign from Trump’s Strategic and Policy Forum

Avant, the Mexican Uber
A screen capture from a video promoting Avant, a Mexican competitor to Uber.

Travis Kalanick, Uber co-founder and CEO, did well to resign from President Trump’s Strategic and Policy Forum. The association between the two brash leaders–Kalanick and Trump–blew up in the United States after the President signed the Muslim ban. The resulting hashtags–#banUber and #boycottUber–threaten to spread globally as Trump alienates people worldwide.

Presidential tensions threaten Uber’s foreign business

On Friday, January 27, Trump had a phone conversation with Mexican President Peña Nieto. Mexican media has characterized the call with Trump as an unusual attack (“insólita embestida”), in which Trump is reported to have said, “I don’t need the Mexicans. I don’t need Mexico. We are going to build the wall, and you all are going to pay for it, whether you like it or not…”. He also spoke of a 10% tariff on Mexican goods to pay for the border wall.

Kalanick’s service on the board, even though it is in name only (He was in India when the group first met.), ties him to Trump.

Truth or fiction: this is the story that gets told around the world. Kalanick runs Uber. Kalanick advises Trump. Kalanick supports Trump. Uber supports Trump.

#deleteUber story links Uber with Trump

The online news magazine sinembargo.mx published an opinion piece urging readers to avoid Uber (U.S.A.). They list numerous competitors: Yaxi (Mexico), Easy Taxi (Brazil), Taxi Beat (Greece), Cabify (Spain), but settle on recommending Avant (Mexico). (Note: I don’t think Taxi Beat operates in Mexico anymore.)

The article begins with a summary of the events at JFK airport. Uber sent out a Tweet announcing that it had stopped surge rates. Many interpreted this as a play by Uber to undercut the protest against Trump’s Muslim ban.

Sinebargo.mx then adds: “In Mexico, people joined the call to erase the app from their cell phones after learning that Uber CEO and co-founder Travis Kalanick is part of Donald Trump’s advisory group.” (En México, los ciudadanos se sumaron al llamado para borrar la aplicación de sus celulares al conocer que el director general y cofundador de Uber, Travis Kalanick, es parte del grupo de asesores de Donald Trump.)

Uber operates in 31 cities in Mexico. Only 2.9% of Mexicans had a positive opinion of candidate Trump, according to a September poll. Uber can’t afford to let ties to an “America First” President cut into its popularity abroad.

The article on sinebargo.mx pushes strongly for readers to adopt Avant in large part because it is a homegrown product. I don’t know if it is pure editorial, or a little advertorial, but the message is clear. Shift to a local product.

Uber faces competition across the globe

This anti-Uber, pro-local message can be replicated in markets around the world. Despite its rapid growth, Uber doesn’t hold a monopoly in any sizable market. These competitors–all unicorns (>$1B valuation) themselves–span the globe:

  • Lyft in the USA,
  • Go-Jek in Southeast Asia,
  • Ola in India and
  • Careem in North Africa and the Middle East.

Many of these markets have sizable Muslim populations. And while Kalanick has said that it is important to have a seat at the table, Trump, not a traditional politician, doesn’t seem to know how to compromise. Kalanick’s resignation from the forum is a first step in combating #deleteUber.

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