For a growing number of countries around the world, the Ugly American these days comes with an Uber license.
The booming low-cost, ride-hailing service is causing all sorts of headaches for cab unions and authorities in dozens of countries as governments and entrenched economic interests fight one of the most influential tech companies in the world.
Protests across France by taxi drivers against the new cabbie business turned violent last week as they obstructed traffic, burned cars and attacked suspected Uber drivers.
UberPop, as the app is called in some countries, is illegal in France, but drivers continue giving rides, angering cab unions that see the service as a threat to their members’ livelihoods. They argue that Uber undercuts cabdrivers’ work, skirts local taxes and evades strict regulations.
In response, French authorities deployed 200 officers to patrol the streets for illegal Uber drivers and even the nation’s highest elected officials felt compelled to weigh in.
“Noncompliance with tax and competition rules is illegal,” said French President Francois Hollande. “UberPop should be dissolved and branded illegal, and cars should be seized.”
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France is not alone in fighting Uber. Critics say Uber is undercutting established business rules and safety regulations that protect drivers and customers. Uber and its supporters say cabbie cartels and government regulators feel threatened because the service is proving popular and cost-effective for customers.
The San Francisco-based ride-hailing service, which allows mobile app users to book instant transportation from private contractors with the click of a button, now operates in 58 countries and more than 300 cities. After Uber’s launch in 2010, it quickly became one of the world’s most controversial entrepreneurial endeavors, spawning numerous lawsuits, accusations of ethical malpractice and protests by frustrated cab unions at home and abroad. Now the company is scrambling to preserve its image and market access as it faces an onslaught of pressure from activists and governments around the world calling for an end to its business.
Uber is suspended, partially banned or fully outlawed in Spain, France, Germany, Italy, the Netherlands, China, Japan, South Africa and South Korea, among other markets. It is also suspended or banned in parts of India, Australia and some cities in the U.S. Complicating Uber’s global drive is the navigation of various regulatory hurdles in different markets and working with officials who have vested interests in keeping the established local services happy.
In Thailand, for example, regulators said Uber ran afoul of local laws because its driver recruits were using private cars rather than licensed taxis. The Uber app for linking a driver and ride seeker is legal — so long as the driver has the right vehicle.
“Thailand does not ban the use of applications in calling taxi services,” Terrapong Rodprasert, director-general of the country’s land transport business, told The Wall Street Journal late last year. “It’s the use of vehicles that are not properly registered that we do not allow.”
Tempest in Thailand
In May, hundreds of taxi drivers in Mexico City called on the local government to ban Uber. Furious protesters claimed the company was not being held to the strict regulation standards that other taxi companies had to follow.
“We are not against technology,” said taxi drivers’ leader Eleazar Romero. “We just want a level playing field. We want everyone to follow the same tax rules we do.”
Uber also has been criticized for silencing dissent after it was revealed last year that the company hired recruiters to reserve cab rides from competitors, such as Lyft, and then cancel them, frustrating local drivers and delaying their services. Later in the year, Emil Michael, Uber’s senior vice president, suggested that the company target journalists who report on the taxi service in a negative light, sparking widespread scorn for the company’s questionable business practices. Uber apologized for both incidents.
Ironically, given its problems in markets around the world, co-founders Travis Kalanick and Garrett Camp came up with the idea for Uber when they had trouble finding a cab as they were running late to a conference in Paris in 2008. Their bad luck turned into a blessing in disguise as they began brainstorming a taxi service that would revolutionize the way people commute. Today, they find themselves at the head of a company valued in the market at more than $40 billion, a company that has shown no sign of pulling in its horns despite massive resistance from governments and business lobbies.
Mr. Kalanick in June told supporters during the company’s five-year anniversary remarks that he expects 1 million more drivers to join Uber by the end of the year, pushing the company’s annual revenue to about $10 billion.
“This is our ultimate vision for the future,” Mr. Kalanick said. “Smarter transportation with fewer cars and greater access; transportation that’s safer, cheaper and more reliable; transportation that creates more job opportunities and higher incomes for drivers. That’s why Uber isn’t just the better choice for drivers and riders and commuters — it’s the right choice for cities and all the people who live there.”
French officials appear unconvinced.
Escalating the confrontation, two Uber managers in Paris on Tuesday were ordered to face charges that included “deceptive commercial practices” and complicity in illegal activities linked to the ride-hailing service, The Associated Press reported.
The Paris prosecutor’s office said Thibaud Simphal and Pierre-Dimitri Gore-Coty were arrested Monday after a police sweep at Uber France headquarters. They are scheduled to appear in a Paris court on Sept. 30.
• Brennan Weiss can be reached at bweiss@washingtontimes.com.
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