Ride-hailing giant Uber and its UAE-based partner Careem have halted their cheapest ride options in Dubai, following a decision by the emirate's transport authority.
Dubai's Roads and Transport Authority (RTA) decided to stop the Uber X service and Careem's Go car service from September 1 after both pilot projects came to an end, the companies said in separate statements on Sunday, without providing reasons.
A spokesman from RTA said both "Uber X and Careem Go were introduced as short-term pilot e-hailing services for customers seeking an economy option. All this was done to compare and evaluate existing and new e-hailing services in the city and check on the feasibility of such technology and services in the market".
Last week, Careem formed a partnership with the RTA to make more than half of the authority's taxi fleet available to book through its app by mid-September. Careem will list all 10,000 RTA taxis on the app by early next year.
Careem and the RTA created a joint venture company named Hala to operate the service, under which the former aims to forge other public sector partnerships.
"As a result [of the pilots with Uber and Careem], RTA decided to incorporate the entire fleet of over 10,000 taxis onto the platform," RTA said in a statement to The National.
"This includes all the taxi franchise companies in Dubai through Hala, an economical e-hailing service. Other economical e-hailing services like Uber X and Careem Go, which operated as pilot, were thus requested to cease operations, with a set deadline over a few months ago."
"Currently there are 5,500 taxis available through the Hala service with fares equivalent to taxis. These can be e-hailed or hailed on the street as well, with the expected time of arrival being under 5 mins. More taxis will be added in phases until the entire fleet is covered."
Careem rolled out its Go service to match the basic price of Dubai's government-run taxis and to compete with then-rival Uber's X services.
The Uber X product is billed as the cheapest option among other ride services provided by the San Francisco company. Other services such as Select, Black and XL are still available in Dubai on the Uber app and website. The Select service is a premium ride in high-end cars, Black is a premium ride in luxury cars and UberXL provides rides for groups of up to six people.
Uber has faced challenges in countries where taxi drivers have complained that the ride-sharing company was undercutting their fares and threatening to drive them out of business, leading to strikes and even lawsuits in some places.
Uber agreed to buy Dubai ride-sharing rival Careem for $3.1 billion (Dh11.39bn) in March, in the largest technology deal in the Middle East so far, eclipsing Amazon’s $580 million acquisition of Souq in 2017.
Careem operates in 120 cities across 15 countries, including the UAE, Saudi Arabia, Bahrain, Jordan, Egypt, Pakistan and Turkey.