Careem, one of Pakistan’s pioneering app-based transport services, has announced it will suspend its ride-hailing operations across the country on July 18, citing a combination of economic challenges, increased competition, and limited capital investment. The move marks the end of a significant chapter for the company that helped shape Pakistan’s mobility landscape since its launch in 2015.
In a LinkedIn post, Mudassir Sheikha, Careem’s co-founder and CEO, called it an “incredibly difficult decision,” explaining that the macroeconomic realities, tight global capital flows, and the intensifying local competition made it unsustainable to maintain the service.
While the ride-hailing operations will cease, Careem’s Super App and other verticals like food and delivery services may continue to operate in select capacities, though further details remain unclear.
A Blow to Pakistan’s Startup and Tech Ecosystem
Careem’s exit underscores broader issues plaguing Pakistan’s tech and startup sector. Since 2022, Pakistan has seen:
- Venture capital drying up
- Inflation peaking at 38% before dropping to 3.5%
- Dwindling consumer demand
- Multiple startup shutdowns, including Airlift, Swvl, VavaCars, and Truck It In
Careem’s departure follows Uber’s phased exit, which began in 2022 and concluded in 2024. Both exits signify the difficulty of operating ride-hailing businesses with thin profit margins in a highly volatile and cost-sensitive market.
Rising Competition
Careem’s challenges have been compounded by the rise of aggressive competitors such as:
- Yango, backed by Russia’s Yandex, offering heavily subsidized rides
- inDrive, a Latin American firm with a unique fare negotiation model gaining popularity in major Pakistani cities
These new players have managed to attract price-sensitive users, further squeezing Careem’s market share and profitability.
Legacy and Impact
Despite its exit, Careem leaves behind a significant legacy in Pakistan:
- Mainstreamed digital payments
- Empowered women drivers and riders
- Created jobs for thousands of captains (drivers)
- Introduced reliable, tech-driven mobility services
As Pakistan’s economic uncertainties continue, the departure of a major tech brand like Careem raises questions about the viability of ride-hailing and other digital services in emerging markets without strong regulatory and financial ecosystems.
Careem’s non-ride-hailing services and the future of its employees and drivers are yet to be detailed. However, the company stated it would assist affected workers and partners during the transition.
