Uber CEO resigns, says rather not “be distracted with another fight”
Detroit: Giving in under pressure by investors at a critical moment for the company, it is confirmed that Uber CEO Travis Kalanick had resigned from his position effective yesterday on grounds that he needed time to come to terms with his mother’s death in a tragic boat accident.
The timing of the resignation comes at a turbulent moment, however, as the company faces challenges to transform itself from a loosely-organized entity into an established one capable of absorbing losses and deliver consistent growth.
Prior to his resignation, Kalanick had made a few bad calls that had tarred the company’s reputation, allegations including suspected sexual harassment of office staff, corporate espionage and the use of fake software designed to evade laws and regulators.
Kalanick stated that he would prefer to resign than to “be distracted with another fight”, suggestive that the board has been deliberately taking steps to get rid of him.
Dissatisfaction with the CEO’s performance reached boiling point when Uber lost a costly gamble for market dominance in China against Didi Chuxing, which forced Uber to withdraw and instead settle for a share in Didi. In the first quarter alone, Uber posted a loss of $708 million, which was an improvement over a $991 million loss posted in the last quarter.
Investors are now considering selling its stocks to the public, which would solidify its standing as an established business entity.
Kalanick’s penchant for aggressive tactics has outraged government regulators, drivers, customers and employees, which has also led to legal trouble in the U.S., where the Justice Department is investigating Uber’s use of fake software to evade government regulators who were trying to determine if Uber was ferrying passengers illegally.
According to Ferdinand Dudenhoeffer, director of the Center for Automative Research at the University of Duisburg-Essen, Kalanick’s lack of tact and sensitivity to social responsibility is the reason that Uber’s profits and reputation has declined. He explained that, “When you’re at war with customers, employees, service suppliers, you can’t build up a business model and Kalanick was at war with everyone. There is no business model in being at war.”
Feature image: Wikipedia, creative commons https://commons.wikimedia.org/wiki/File:Travis_Kalanick_at_DLD_Munich_2015_(cropped).jpg