Uber share price slides to near-record low after losing London licence
The ride-hailing company saw its stock fall 3% in pre-market trading, nearing a record low, after its London licence was not renewed by Transport for London.
Uber saw its share price fall 3% to $28.66 in pre-market trading – nearing a record low – after its London licence was stripped by Transport for London (TfL).
TfL refused to renew the ridesharing company’s private hire operator’s licence after it found that more than 14,000 trips were taken by drivers that had faked their identity on the Uber app.
The transport authority said that while Uber has made a number of positive changes and improvements to how it operates, a ‘pattern of failures’ has put passengers safety at risk.
‘Despite addressing some of these issues, TfL does not have confidence that similar issues will not reoccur in the future, which has led it to conclude that the company is not fit and proper at this time,’ TfL said in a statement on Monday.
Looking to trade Uber? Open a live or demo account with IG.
Uber to appeal TfL’s decision
Uber will continue to operate in London due to the ridesharing company looking to appeal the decision by TfL.
When TfL first rejected Uber’s licence renewal, in September 2017, the firm eventually persuaded judges to award it a 15-month licence to continue. The company's management is hoping that it can convince judges a second time round to renew its licence.
‘While we recognise Uber has made improvements, it is unacceptable that Uber has allowed passengers to get into minicabs with drivers who are potentially unlicensed and uninsured,’ Helen Chapman, Director of Licensing, Regulation and Charging at TfL said.
'It is clearly concerning that these issues arose, but it is also concerning that we cannot be confident that similar issues won't happen again in future.
‘If they choose to appeal, Uber will have the opportunity to publicly demonstrate to a magistrate whether it has put in place sufficient measures to ensure potential safety risks to passengers are eliminated,’ she added.
You can go long or short Uber with IG using derivatives like CFDs.
This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only
