Postmates is merging with Uber Eats: Here’s what it means for drivers

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The switch is on!

When Uber bought Postmates back in the summer of 2020, we were told that the two companies would operate separately, as detailed in this July 2020 Gridwise post. Now, however, it appears that the merger, which was officially completed on December 1, 2020, is a done deal for both drivers and customers.

In this post we’ll look at how these changes will affect Postmates and Uber Eats drivers as the apps merge and the two companies work as one. The main points to be covered:

  • The status of the Postmates-Uber merger
  • What the merger means for Postmates Fleet members and Uber Eats drivers
  • How the Postmates acquisition could affect Uber’s rideshare and delivery services
  • How can drivers get the most out of this deal?

The status of the Postmates-Uber merger

Although referred to as a “merger,” the deal is, in effect, a full-on acquisition. Uber now fully owns Postmates, after transferring $2.65 billion in Uber stock to Postmates.

Even when the official news was released, Uber announced that Postmates would continue to operate separately. This may have been the case for some time, but things seem to have recently changed.

Now, Postmates drivers are getting notices telling them they must apply to Uber Eats. Postmates has shut down its driver affiliate and referral plans and has told all its delivery people the app is going away, and they will no longer be part of the Fleet. 

On a corporate level, Postmates laid off 15 percent of its staff (185 employees) in January 2021 and its founder and CEO, Bastian Lehmann, announced that he was leaving the company. Recently, customers and restaurants have been introduced to the idea of Postmates being “folded into” Uber Eats. According to media reports, Postmates will no longer operate separately after June 2021. 

It appears that the Postmates–Uber transition is just about complete. That means it’s time for Postmates Fleet members and Uber Eats drivers to examine the impact the merger will have on their respective delivery gigs.

What the merger means for Postmates Fleet members and Uber Eats drivers

The not-so-good

Postmates drivers likely have the most to worry about, as Uber Eats is well known for having tougher restrictions on drivers. For example, vehicles more than 20 years old were acceptable for Postmates, but not for Uber Eats. Also, if you’re a driver who wants to hop on your bike and do deliveries rather than driving your car, you can’t do that with Uber Eats. You have to open a separate bike delivery account.

Uber Eats’ background check is known to be stricter, too. And if you’ve been deactivated by Uber Eats, and took refuge as a delivery driver for Postmates, good luck getting back on the Uber Eats app. The transfer from Postmates to Uber Eats is not automatic. Postmates Fleet members must apply separately to be Uber Eats delivery drivers.

As the tech portion of the merger took effect, Postmates drivers found it pretty rough going. According to a May 17, 2021 article in Buzzfeed News, once the apps started to combine, there were reports of drivers failing to receive their payments. For now, things seem to have smoothed out, but it’s easy to see why these drivers may have felt slighted.

Drivers for Uber Eats could also stand to lose from this merger. Obviously, more drivers in the same company means more competition for orders. But since former Postmates customers will be in the pool of Uber Eats orders, the impact might not be too severe. 

The not-so-bad

Any driver who has worked for both Postmates and Uber Eats will tell you that Uber has much better customer service and the app is more reliable. It’s also more flexible; for instance, drivers for Uber Eats are always notified about stacked orders.

That wasn’t the case with the Postmates app. A feature that allowed fee-free drop-offs for people at the same location as other deliveries often meant Postmate Fleet members had to haul (and wait for) up to five hours in one run. Though there will be some stacked orders, drivers  can choose whether or not to take them on the Uber platform.

Customers can give tips on Uber Eats either before or after the trip. On Postmates, there was never any way to know whether you’d get a tip or what it would be. Uber’s platform and policies are clearer and more straightforward, and will be a welcome change for former Postmates drivers.

How the Postmates acquisition could affect Uber’s rideshare and delivery services

Let’s face it. Uber wouldn’t bother to pay all that cash for a company if it didn’t see the good that would come from it. One of the many benefits for Uber through this acquisition is access to a whole population of drivers at a time when the company is working hard to get people to drive. See more about the incentives they’ve been offering to delivery drivers in this Gridwise article

An automatic influx of drivers from Postmates could provide the solution to Uber’s driver shortage problem on both sides of the business. Some delivery drivers might make the move over to rideshare, since it’s relatively easy for qualified drivers to switch back and forth between moving delivery items and carrying passengers on the Uber app. 

The Uber Pro rewards program applies to both sides of the company, so rideshare drivers can maintain their benefits through both rideshare and delivery. Those who drive for delivery only are eligible for Uber Eats Pro, where it’s available.

Uber has stated that its acquisition of Postmates will help the company pave the way to profitability. Certainly, the surge in delivery business in 2020, and its continued success now, show that investing more in this branch of mobility could be a smart move. Postmates’ stronghold in Los Angeles and the Southwest can only add to Uber’s potential for success and further growth both now and in the future.

With Uber Eats gobbling up Postmates, Uber will now grab up 37 percent of the national food delivery market share.

How can drivers get the most out of this deal?

If you’re a Postmates driver, the best thing you can do (if you qualify) is sign up to drive for Uber’s rideshare service as well as Uber Eats. If you do this now, sign up as a rideshare driver first and you’ll automatically be accepted as an Uber Eats delivery driver. The incentives for signing up as a rideshare driver, during the second quarter of 2021, are considerable. Don’t miss out on them.

If you’re already an Uber Eats driver, you’ll automatically benefit from the additional orders that are likely to come in through Postmates. Also, because some Postmates drivers won’t be eligible to drive for Uber, you’ll have the opportunity to pick up the business they’ll be unable to process because they don’t qualify to work for Uber.

Since the companies are consolidating under one corporate umbrella, another advantage for both companies’ drivers is greater leverage for negotiating better pay and job security. Uber has made overtures to drivers through Prop 22 in California. It’s likely that more changes in driver compensation will emerge as drivers in other states also demand them.

Drivers can also make the most of this deal by remembering that they can always work for more than one platform. If the conditions of driving for Uber don’t work out for you, consider moving over to another delivery company, or maybe into parcel or grocery delivery. You can get an idea of potential earnings in this Gridwise post about working for Shipt.

Make more money and track it – with Gridwise!

Whether you move over to Uber from Postmates or decide to diversify into other driving gigs, Gridwise has you covered. Simply connect your driving app to Gridwise, sign on at the beginning of your shift, and your earnings and mileage will be tracked, tabulated, and consolidated into graphs like these:

You can see how much you make per hour, what you’re getting for each trip, and also track your expenses as they come in. Use this information to see exactly what you’re making from each company, and then you can decide how to mix your gigs to maximize your earnings.

Gridwise also helps you make money by giving you inside information about airport activity, traffic, and events in your area. Gridwise helps you save money by checking the Perks Tab for deals and discounts that make every driver smile.

You’ll get alerts that take you to the latest news from our informative blog and YouTube channel, too. And, when you join us on Facebook, you’ll be in a community of drivers who share your concerns and turn you on to new ideas and opportunities.

Gridwise is the ultimate assistant for rideshare and delivery drivers. If you don’t have the app yet, you need to download it – right now!

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