In a surprise move, the board of ride-hailing company Uber tapped Dara Khosrowshahi as its new chief executive officer.
There are a few formalities that still need to be attended to, such as officially notifying Uber employees, but it appears that the current CEO of Expedia Inc. will take the reins of what has been called “the unicorn of all unicorns.”
Barry Diller, chairman of Expedia Inc., filed a letter to employees with the Securities and Exchange Commission:
“As you probably know by now, Dara Khosrowshahi has been asked to lead Uber. Nothing has been yet finalized, but having extensively discussed this with Dara I believe it is his intention to accept. I also know the struggle he has been having out of both his abiding enthusiasm for Expedia’s future as well as his loyalty to all of us. I know Dara would like to communicate now with all of you but I’ve asked him not to until this is fully resolved.”
Assuming all goes as planned, Khosrowshahi will lead a company that has been variously described as a basket case or a train wreck, with a long litany of scandals and missteps over the last year, from skirting regulations to mishandling the case of a driver accused of rape.
Uber’s previous CEO, founder Travis Kalanick, was ousted from his post in the wake of the turmoil but remains on the board of directors.
Khosrowshahi would bring some discipline to the company. “They’d be putting adult supervision at the helm,” travel analyst Henry Harteveldt said.
Harteveldt, who leads Atmosphere Research Group, said Khosrowshahi also would bring some thoughtful ideas to what’s next for Uber’s planning and booking processes as well as expertise in business and finance and profit and loss accounts.
Robert Cole, who heads the RockCheetah travel technology consultancy, agrees that Khosrowshahi would be “a great addition” to Uber in the areas of both multidimensional talents and ethics, but “he’s facing a really hard job.”
Hardest among his initial tasks is likely to be the maintaining of Uber’s near-$70 billion valuation. All the boardroom drama of the last year has caused it to lose momentum, Cole said.
Another big task will be ensuring that the drivers maintain status quo on their status as independent contractors; Uber does not want an army of employees for whom it would be responsible.
Cole believes Khosrowshahi’s travel industry background would be a plus in the next phase of Uber’s development: the use of data analytics in a world of autonomous vehicles.
Expedia bucked the trend in the early days of online travel, choosing to maintain call centers when other companies decided to eliminate the human customer service element.
Expedia saw that there are times when human assistance is needed.
Cole said Uber might find that using its data, it could determine when a driver is needed and when a self-driving car is sufficient.
For example, an elderly passenger might need assistance getting in and out of the car; a family might enjoy a driver/tour guide during a vacation, or kids might require a watchful eye while they are being driven to school.
That may prove to be Khosrowshahi’s biggest task, Cole said: creating value by matching the trip to the needs of the customer.