Uber-Postmates Merger Will Only Serve Monopolists
Washington, D.C. — The Protect Our Restaurants campaign released the following statement in response to new reporting that revealed the Department of Justice is conducting an in-depth review of the proposed Uber-Postmates merger:
“An Uber-Postmates merger will serve no one but industry monopolists hellbent on growing their power at the expense of restaurants, workers, and consumers,” said Moe Tkacik, Senior Fellow at the American Economic Liberties Project and author of “Rescuing Restaurants: How to Protect Restaurants, Workers, and Communities from Predatory Delivery App Corporations.” “Nearly 40,000 independent restaurants and bars have closed permanently since the onset of Covid-19. Meanwhile, Postmates and Uber are burning billions, backed by deep-pocketed investors who are betting they can monopolize the market, cut wages, and hike their already-enormous fees. If this merger is approved, they will have been right. Antitrust enforcers must reject this absurd deal.”
“We are strongly concerned as to how this merger will further constrain small and independently owned restaurants,” said Carolyn Pincus of the American Sustainable Business Council. “During this ongoing health crisis, restaurants are already under immense pressure to stay above water and cannot absorb the exorbitant fees nor stave off the damaging business practice of listing restaurants on their platforms without approval. This merger would only increase their market power by increasing barriers of entry for new delivery apps to enter the market with competitive pricing and quality customer service.”
DoorDash, GrubHub, Postmates, and UberEats control 99 percent of all food delivery sales. In many cities, just two of the apps dominate. The result of dozens of anti-competitive mergers, this four-app delivery cartel charges enormous fees, plagiarizes menus, manipulates Google search results, and props up ghost kitchens, making it nearly impossible for restaurants and their workers to get by. Rather than bring efficiency, mergers in the industry have only worsened conditions for restaurants and consumers, who have been left to deal with lost orders, dysfunctional tech support, and a substantial decline in customer service.
The integration of Caviar’s ordering platform into that of DoorDash, which bought the company last year, has been a logistical and financial disaster for Caviar’s restaurant partners. If the Uber-Postmates merger is approved, restaurants will be left with no choice because in markets like Los Angeles and Miami where Postmates has significant market share. Indeed, Uber-Postmates will be the only game in town.
For more information, read “Rescuing Restaurants: How to Protect Restaurants, Workers, and Communities from Predatory Delivery App Corporations,” and visit ProtectOurRestaurants.com.
Economic Liberties works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. AELP believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.