Uber Eats has lost the exclusive rights to make about 15 million McDonald’s deliveries each year in the United Kingdom.
The food delivery operation is facing new competition from its much bigger rival Just Eat (JSTTY), which announced Tuesday that it will become McDonald’s’ second delivery partner in Britain this year.
The loss of the McDonald’s (MCD) delivery monopoly is a huge knock to Uber Eats. The delivery service does about 30 million orders in the United Kingdom annually and McDonald’s accounts for about half of those, according to Joseph Barnet-Lamb, an analyst at Credit Suisse.
“Without that exclusivity, orders could be under pressure in 2020,” he told CNN Business.
McDonald’s UK CEO Paul Pomroy said in a statement that the existing partnership with Uber Eats has been “hugely successful.” Delivery is available from 950 restaurants.
“We are delighted that we have agreed to partner with Just Eat as an additional delivery provider in 2020,” Pomroy added.
CEO Dara Khosrowshahi said recently that Uber Eats will get out of markets in which it cannot establish or defend a No. 1 or No. 2 position. Uber said last week that it would sell its food delivery business in India to a local rival.
Just Eat is the biggest food delivery operation in the United Kingdom, where it processed 123 million orders in 2018. It is strongest outside London.
Source: CNN
