Uber struggling to dispose of its sizeable fleet six months after pullout

The Uber-owned vehicle leasing operator, Lion City Rentals, still has several thousand cars - many unhired - in its fleet, six months after the American ride-hailing firm pulled out of Singapore.

The Straits Times understands that Lion City intends to close down, and has been trying to dispose of the fleet. For a number of months now, it has been putting up cars for bidding by rental fleet owners and used car dealers.

Many of its cars - mostly Mazda3 sedans and Honda Vezel crossovers with low mileage - were also advertised on online portals such as sgCarMart. But response has been weak. Lion City is said to still have up to 10,000 of the 15,000 estimated cars in its fleet as of early this month.

"The market cannot absorb so many cars. It is now deregistering cars, and exporting them to other countries," a senior manager at a rental firm said. "We hear Grab has also bought some."

Asian ride-hailing giant Grab, which took over Uber's regional business in March, said it bought "a small proportion" of Lion City's fleet. Transport giant ComfortDelGro also bought some cars.

Uber would not say much when contacted. "Lion City Rentals continues to partner with thousands of drivers and hirers every day in Singapore and remains committed to the market," a spokesman said. 

Checks by The Straits Times revealed that several hundred unhired Lion City cars are parked in places such as Big Box Singapore, Carros Centre and Sports Hub.

On Monday, the Competition and Consumer Commission of Singapore (CCCS) fined Uber $6.6 million for contravening competition laws when it sold its South-east Asian ride-hailing business to Grab in March.

Grab was fined for $6.4 million for its role in the sale. The CCCS also set out a number of measures which both companies had to meet. Among them, Uber must sell vehicles from Lion City Rentals - which was not included in the deal with Grab - to any potential competitor with a "reasonable offer". Uber will need the approval of CCCS to sell the vehicles to Grab.

In a related development, motor traders said Lion City's car disposal has weakened demand for new cars, contributing to sliding certificate of entitlement prices. The situation is in stark contrast to 2016 and 2017, when Uber's ambition to grow its Lion City fleet helped drive COE premiums sky-high.