Uber says rides down by as much as 70% in cities hardest hit by coronavirus, looks at delivering meds

Uber — the on-demand transportation and food delivery behemoth — has been hit hard by the novel coronavirus pandemic. CEO Dara Khosrowshahi said today in a call with investors that ride volume has gone down by as much as 60%-70% in recent days in the hardest-hit cities like Seattle, and that’s before you consider the pauses in some of its services, and the dubious distinction of becoming one of the earliest proof-of-concepts of just how spreadable this virus really is.

But Khosrowshahi also told investors in an update that the company believes it is “well-positioned” to ride the troubles out even in the worst-case scenario of rides down by 80% for the year. And even as rides for passengers are down, it is also considering leveraging its network for delivering other things, such as medicine or basic goods.

“We already have contact in the health sector, we’ve got all of the processes that we need,” he said, referring to Uber Health.

He also said that the company had “ample liquidity.” The company said it currently has $10 billion of unrestricted cash on hand as of the end of February, with $1.5 billion of that earmarked for M&A through the end of the year (that includes investment in Cornershop and its Careem obligation).

If rides globally declined by as much as 80% (the extreme edge case, which Uber said it doesn’t expect to happen) that would still leave $4 billion of unrestricted cash in the bank, he added, plus a $2 billion credit line. In a scenario where Q2 is the “bottom” with recover in Q3, that scenario shows $6 billion in cash on hand, plus the $2 billion revolving credit.