Kavak and Uber Getting TogetherBy Sofía Hanna | Fri, 11/27/2020 - 17:33
On the last release from Kavak and Uber, both companies announced that they are coming together in an alliance that will offer Uber drivers a special deal to buy a car. This move benefits both companies and Uber drivers as a way to encourage more people to join the app and buy a car instead of renting it.
The alliance made by both companies offers Uber drivers the possibility to buy a vehicle from Kavak financed with weekly payments, starting at MXN$ 1500 (US$ 74.73), with a zero percent down payment.
Up until now, this deal was only made available in Guadalajara, Monterrey and Mexico City, as stated in a Forbes article.
Federico Ranero, director of operations at Kavak, stated that this is a new solution for people to improve their economic situation by owning a car and having the opportunity to pay for it as they can, according to their current economic situation. Also, one of the things given with this new alliance is a warranty period of seven days or 300 kilometers as well as bonuses for driving a car, from Kavak, in a platform.
When the COVID-19 pandemic started, Uber quickly generated a help plan for its drivers, giving options to those who could keep working and support for their drivers who got sick. An important part of the support was in the economic side and this new alliance goes on the same track, given that part of their drivers rent the car they use to work, now giving them the opportunity to have their own at the pace they can handle comes as a great help, information retrieved from the Uber blog.
Something to take into consideration is the importance of this alliance from Kavak´s perspective. In a previous MBN article, it was mentioned that the company was the first Mexican unicorn after reaching a valuation of US$ 1.15 billion, and by moving forward with a plan of this magnitude with Uber, it positions them in a perfect spot considering the amount of time the business has been running.
Also, in an interview made with Carlos García, CEO of Kavak, he mentioned that part of their plans is that "all consumers involved in purchasing, selling or financing a vehicle will see Kavak as their first option given the benefits we will offer," so now not only will consumers think of Kavak as their main option, but also now they have the attention from Uber users which represent 80 percent of the Mexican market in terms of mobile apps, according to El Universal.
On the same MBN interview, it was also made clear that part of the hit taken by the COVID-19 was a slow down in the operations and trying to provide a contactless experience. Still, with this new strategy, operations could start to rise again.