Luxury Ride-Hailing App Pivots to Middle East as Lockdowns Bite

A luxury ride-hailing app operating in Moscow, London and Paris is expanding into the Middle East as a “hedge” against lengthy lockdowns that have shattered the services industry in Europe.

Wheely will apply for an e-hailing license in Dubai in the coming weeks and open an office there as a hub for the Middle East, said founder and Chief Executive Officer Anton Chirkunov. Dubai is a top destination requested by Wheely customers, especially those traveling from Moscow, he said.

“We are now looking at these geographies as a hedge against restrictions,” Chirkunov said in a video interview from London, where Wheely moved its headquarters from Moscow just under two years ago. “We had southern France as the next step in our plan, but we don’t understand what’s going to happen in France in terms of restrictions, so we are looking at the Middle East instead as the next step.”

Wheely started serving wealthy Russians in Moscow in 2012 with its luxury Mercedes-Benz cars driven by chauffeurs wearing a suit and tie. The company says it now attracts a broader clientele beyond Russia’s borders.

Dubai, which relies on international tourism for almost a third of its gross domestic product, reopened in July, while most European countries have largely kept their borders shut amid the pandemic. The United Arab Emirates’ vaccination campaign is among the most ambitious in the world, targeting inoculations for half of the population by the end of March. It’s also one of the few countries welcoming tourists from Russia.

In contrast, England will only start easing the third national lockdown from March 8, while France will decide in the coming days whether to relax or tighten pandemic restrictions. In the meantime, authorities ordered a weekend lockdown in the city of Nice and surrounding coastline area in southern France.

Still, all the company’s markets, which include Moscow, London, Paris and St. Petersburg, had recovered to 99% of pre-pandemic levels as of Feb. 22. Before the restrictions bit early last year, gross bookings reached $110 million in December, with London growing 2.5 times faster than Moscow, according to the company.

Wheely, which has about 3,500 active chauffeurs and 200 employees, plans a new fundraising round in the third quarter, targeting more than $30 million to boost investments after the lockdowns, including for expansion into the U.S.

©2021 Bloomberg L.P.

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