Uber's board has been meeting daily and was deliberating on its pick for a new leader over the weekend.
Khosrowshahi's surprise selection was reported this evening by the New York Times and Recode, citing anonymous people familiar with the decision by Uber's board. Immelt backed out right before the vote, supposedly after doubts about his leadership and potential over-eagerness to court Travis Kalanick.
Khosrowshahi will be responsible for improving Uber's image by fixing tussles among investors, rebuilding employee morale and creating a profitable business after seven years of losses.
The choice ends almost two months of constant speculation, as well as reported meddling by Kalanick, who still maintains a seat on Uber's board. Finally, Khosrowshahi emerged as the "truce" candidate that all board members felt comfortable with. Reports claim that in these two months, Kalanick, who still maintains a seat on Uber's board, had been influencing the board to tilt things in his favour.
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The Land Transport Amendment Act, passed on August 4, and coming into effect October 1, took Uber's core service out of a legal grey area and defined it as street legal. CEO Jeff Immelt was an early favorite, but he officially withdrew on Sunday.
Khosrowshahi has been president and chief executive of Expedia since 2005.
Uber, the world's most valuable startup, is reeling from a catalog of crises culminating in the forced resignation in June of its CEO and co-founder, Travis Kalanick, who remains a powerful shareholder and board member. Married to actress Sydney Shapiro, Khosrowshahi oversaw a period of rapid growth for the former Microsoft Corp. -owned company, including the acquisition of competitors such as Orbitz Worldwide Inc. In that, they found almost 40 percent of the company's voting power asked to step down the Travis.
Since the beginning of the year, Uber was hit with allegations of sexual harassment that led to an internal probe, a high-stakes lawsuit with Google's Waymo over self-driving technology, a federal investigation over the use of its secret Greyball tool used to deceive regulators and a slew of top executive departures among other controversies.
This apparently came moments after the Uber Board finalised the CEO. Though the company now has a CEO, it still has no CFO, and there are nearly half a dozen other unfilled executive positions, as top talent continues to exit the company.
The company's problems started snowballing in February when former Uber engineer Susan Fowler wrote a blog post titled "Reflecting on One Very, Very Strange Year at Uber".