Dubai-based ride-hailing service Careem Networks FZ is abandoning its up-market car service in Turkey just one year after launching the product to focus on Istanbul’s $1.5 billion taxi market.
The company is working on new partnerships for its taxi-hailing service that will improve the quality of rides in the city of 17 million people, said Ibrahim Manna, the managing director of emerging markets at Careem. The shift in strategy comes as people familiar said its rival Uber Technologies Inc. is in talks to acquire the firm as it expands in the Middle East.
Ride-sharing firms like Uber and Careem have faced a government crackdown and a barrage of fines as they attempt to take on the more than 18,000 local yellow cabs by offering a premium service in higher-quality minivans. President Recep Tayyip Erdogan pledged to take necessary action against Uber in June, saying the San Francisco-based company’s business in Turkey was “over.”
"One of the main reasons we ended comfort type was to avoid our captains losing their tourism licenses," Manna said in a response to emailed questions. "We are dedicated to respecting government decisions, we’ve paid all our fines in advance to avoid additional costs in the future."
Careem recently began offering services in Sudan and is looking to expand to Tunisia, Algeria and several markets in Sub Saharan Africa, Manna said. He declined to comment on reports of a possible acquisition by Uber.