How Blacklane is taking on Uber and Lyft amid COVID-19

Jens Wohltorf, Blacklane CEO & Co-Founder joins the Yahoo Finance Live panel to discuss how Blacklane seeks to challenge Uber and Lyft in city rides.

Video Transcript

AKIKO FUJITA: Well, the ride hailing space is getting a little more crowded here in New York City. Blacklane is launching a new chauffeur hailing service, looking to challenge rivals Uber and Lyft, particularly with business customers. Let's bring in the CEO and co-founder of Blacklane. We've got Jens Wohltorf.

Jens, it's good to talk to you today. This is interesting timing for me in terms of launching this, particularly if you're going after business customers, because it does feel like there's not a whole lot of movement on the high end right now when you talk about ride hailing. Why launch now?

JENS WOHLTORF: Well, we-- first of all, we go after customers who appreciate quality and a clean, private space. And indeed, I think there was never a better time to present such a product to the marketplace, like now in the middle of a pandemic, where you really are concerned about how you move, if you have to move, for essential rides, for instance.

And with our product that we have built over the years, but rather focusing on airport transfers in the past, we have everything in our hands to be presented to a new use case, which is chauffeur hailing in cities like New York. And we already see quite a run through to those kind of services.

ZACK GUZMAN: Yeah, and Jens, I mean, when we're talking about the space in general, we've seen Uber and Lyft recover in this pretty notably because of the way that they've been stressing profitability by the end of the year at some point here in 2021. When you look at it, I imagine that the higher end clientele that you guys are going after might be a bit more profitable there. But at this point, I mean, doesn't it seem like you'd have to show profitability rather soon? Or what's your kind of stage, as you see it?

JENS WOHLTORF: Yeah, you're right. Actually, we do see different unit economics in our space than you would see in traditional ride hailing with taxi industry. So we always use-- we always did a very healthy business model. But indeed, like, focusing on airport transfers in the past, and which, indeed, stood in our way to achieve profitability that was planned for the end of last year. We were quite nicely on track.

But given this focus on airport transfers and business, and we, indeed, had to take a hit of a 99% revenue loss in April 2020, so that, indeed, delays the process of reaching profitability for a little. But we are on great track. And thanks to those products like chauffeur hailing, we have the right things in our hands to continue to accelerate.

AKIKO FUJITA: You've got some good visibility on just business activity, given that you're not just launching in New York City, but also 21 other cities this month. What's the sense right now, as you look at the activity on your platform and you hear more about where the business clientele demand is, in terms of how significantly activity is starting to ramp up?

JENS WOHLTORF: Yeah. Indeed, we have quite a nice view also on a global scale, thanks to our presence in over 50 countries. And now with chauffeur hailing, we are, indeed, focusing a lot on the US. And also, thankfully, thanks to the speed of recovery that we see in the US being rather fast, much faster, actually, than in Western and Central Europe, we believe and I think this was the right choice to focus on the US.

And so, business is picking up quite nicely there. Recovery is seen not so much on airport transfers business and our traditional brick and mortar business, but in chauffeur hailing, we see a lot of activities in the US compared to other markets that we launched, and also on our product, what we would call intercity, so traveling from in New York to Boston, DC, Philly, or the like, instead of hopping into a crowded plane or onto a crowded train. We are also seeing a lot of demand picking up on the east coast, on the west coast, pretty much across the country in larger cities.

ZACK GUZMAN: Yeah, that seems like an interesting offering. A flat fee, you guys say, between New York, Boston, DC, $399 for one or two riders. Obviously, that would be a distinct offering there. When you look at that space, though, I mean, long term for you guys, are you maybe starting here at this high end echelon and going broadening out maybe in a year or two years down the road, just like we saw Uber and Lyft kind of start with ride sharing writ large, but then kind of shifted into offering premium services. How do you see it playing out in how wide your total market is?

JENS WOHLTORF: Well, the market is gigantic, and in this-- for instance, in this intercity offering, we are, indeed, stepping into short haul flight markets into a train, intro a car rental business, on a huge market that we are planning to enter and to challenge. And there is a lot of space, actually, for such a service like ours, such a clean and private space.

And I also believe that it's here to stay. It's not going away at the end of the pandemic, and everything goes back to normal. I think a conscious view on a healthy and safe way to travel, ideally door to door with as little handover points and disruptions as possible will be a quite significant market for us going forward.

So, actually, being very focused before the pandemic on airport transfers would be really good in this, but during the pandemic, realizing that it also made us extremely vulnerable and made us quite strong with those two additional offerings, which is chauffeur hailing, but also Blacklane intercity.

AKIKO FUJITA: Yeah, I mean, can you be a pure ride hailing play? It seems like if you look not just in the US, but globally, every one of these companies that started with just that has really had to sort of add their tentacles to try and capture a bigger market.

JENS WOHLTORF: Yeah. But as mentioned in the beginning, like, we have built a business that is an extremely healthy model, and we are very good in actually providing an end to end high quality service with much attention to the littlest details. This is a different mentality than what you would expect from a technology platform driven ride hailing supplier and that can easily branch out, then, in other areas of logistics.

But we are-- our entire DNA is focusing on a superior service experience, like what you would expect from a five star hotel in comparison with other more mid-range hotel. So, more of a Michelin star restaurant instead of a fast food chain. So I think we are really focusing on this. It's apparently more and more nice than the mass markets, but a very attractive one, a very solid one, and a very fast growing one.

AKIKO FUJITA: Jens Wohltorf, Blacklane CEO and co-founder, thanks so much for joining us today.