Uber – a country dweller responds…

So, Uber, a company whose business practices have been, thus far, somewhat suspect, have been told by Transport for London that, unless they sharpen up their act, they’ll lose their licence. Cue the more libertarian tendency, who have claimed that millions of people use them and that 40,000 people will lose their jobs.

Time for some perspective.

According to Uber, and let’s assume that their figure is accurate here, 52 million journeys were made in London using their service last year, and that they had 3.4 million users in that time.

That works out as being just over six journeys per Londoner during that period, assuming of course that only London residents used it – a pretty unlikely scenario given its popularity with young people who travel abroad. You wouldn’t describe it as a core part of London’s transport infrastructure at that sort of level, compared to say the 1.35 billion journeys made on the Tube, or the 2.3 billion journeys made by bus or even the 117 million journeys on the DLR, and that’s before you consider the surface rail network, cyclists, car users, those who walk or use other private hire vehicles.

So, Uber isn’t vital, really. It’s convenient, true, but not essential.

As for the job losses, 52 million journeys, divided by 40,000 Uber drivers, works out at five per day per driver, based on a five day week. If the average Uber driver is living off of that, I’d be amazed. There will be, obviously, some full-time drivers, but exaggerating the numbers in support of Uber does nobody any favours. And besides, if Uber passengers are displaced to other travel options, potential jobs are created there.

The hyperbole aside, this is an issue about regulation – the balance between freedom and protection, if you like. You can even argue that it’s a question of choice. Few would argue that the emergence of Uber in particular has not driven improvements in its competition, with new online options for booking taxis popping up, and that makes for more accessible options for potential travellers.

But there has to be a level playing field to ensure that choice continues to exist, and that means a degree of regulation to ensure minimum standards of safety in transportation. It also means that the regulatory body must reasonable access to compliance data, something that Uber have a poor attitude towards, their use of Greyball being just the most prominent example.

Uber are being offered a straightforward choice, comply with those regulations deemed to be appropriate, or not have a licence. For, if their service is financially competitive, it will survive having to obey the same rules as its equivalent competitors. If not, perhaps it isn’t worth the $65 billion it is currently valued at.

A final note. I live in a small village in rural Suffolk. It has no scheduled public transport and, funnily enough, having tried Uber this afternoon, there were no cars available. For those of us without the amazing diversity of choice that London offers, and who have seen swingeing cuts in rural bus services over the past decade, the irony of such uproar over a minute fraction of the overall transportation choice available to Londoners is not lost.

Londoners get a vastly larger share of transport spending than any other part of the country. Perhaps some support towards better transport options in the rest of the United Kingdom is a higher priority?

* Mark Valladares is a regular user of public transport and supports his local minicab firm.

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21 Comments

  • Richard Easter 24th Sep '17 - 12:07pm

    The problem with the 40,000 jobs lost argument pushed by some is that :

    1) Uber is one of the biggest pushers of driverless car technology and thus in the long term wants rid of all of its drivers.

    2) Many of the people making the jobs argument over Uber appear to be the same people with no sympathy for Port Talbot and Redcar steel workers, IT and call centre workers facing job offshoring, train guards at Merseyside, Northern and Southern, the Grangemouth dockers, miners and various public sector workers in all sectors from health, education, the armed forces to policing who are, or have faced unemployment.

    I see a lot of right wingers playing the “jobs” card, despite the fact they have never cared about the jobs of many working class people over the years. The only other time incidently I see them play the jobs card is over the potential for loss of employment in arms sales if we tell the Saudis where to go.

  • A well balanced article. At the end of the day Uber cut corners to displace rivals and generate turn over ( I would say generate profit but as they have never made one that can’t be true). Recently they have tried to cut out some of their more problematic business practices along with changing their leadership but as their new CEO said after the London ban

    “While the impulse may be to say that this is unfair, one of the lessons I’ve learned over time is that change comes from self-reflection. So it’s worth examining how we got here. The truth is there is a high cost to a bad reputation.”

    http://uk.businessinsider.com/high-cost-to-a-bad-reputation-new-ceo-warns-uber-in-london-ban-2017-9

    If you wish to know more about the Uber business model may I suggest

    https://wolfstreet.com/2017/08/23/uber-wants-you-to-know-its-not-collapsing/

  • paul barker 24th Sep '17 - 1:12pm

    Its a Political decision made by a Politician, the stuff about rules is a smokescreen. Just look at the people backing the campaign against Uber : a bunch of Authoritarians, Communists & Nigel Farage.
    Of course Uber arent important to commuters, they are however important to (mostly) young people, out late at night when most of the Public Transport system closes down.

  • paul holmes 24th Sep '17 - 1:28pm

    Excellent article Mark. Puts a highly factual analysis onto the rather hysterical stuff about having to defend free markets whatever the abuses.

  • @paulbarker

    Are you aware that London has numerous 24hour bus routes?

    Something we provincials can only dream of …

  • Richard Easter 24th Sep '17 - 8:02pm

    Paul Barker – Which communists are those? I assume you mean trade unionist taxi drivers in the LTDA, RMT and Unite, or the centre left Sadiq Khan (neither Blairite nor Corbynite). And like it or not, Nigel Farage is not 100% wrong about everything – he has claimed to be consistently opposed to Iraq (like Charles Kenendy was) and opposed to the Libyan war.

    There are plenty of voters out there who sympathise with positions taken by Corbyn or Farage – and both for that matter – and they are voters the party needs. Presumably if everything is that binary, the Liberal Democrats should support George Osborne, Philip Green, The National Outsourcing Association, Goldman Sachs or Ryanair, because they happened to be on the same side in the EU Referendum.

  • Tony Greaves 24th Sep '17 - 11:44pm

    Good stuff, Mark. Public transport in London is unbelievably good. I know, I use it for part of the week for part of the year. (And I do not even know how to use Uber and do not intend to find out).

  • Daniel Carr 25th Sep '17 - 8:20am

    This is a good thread on the evidence around Uber’s alleged poor record in London: https://twitter.com/paul_a_smith/status/911933427410259968

    I’m happy to believe otherwise (that Uber are substantially worse than Black Cabs, despite this being the opposite of what I personally saw with respect to licensed taxi drivers in Australia) but rather than believe a 230 statement from TfL I’d like to see some data and hard facts.

    Is that too much to ask from a government body?

  • Lorenzo Cherin 25th Sep '17 - 12:48pm

    I have never used this app, and defend their right to get more time to get their house in order, not their mistakes.

    But Mark and others are unfair to Paul Barker herein. His language is over the top, but he is a valuable centre left and constructive member with a liking for mainstream Labour thinking and not a rabid anti anything.

    His point is a valid one though his making of it ham fisted.

    The excellent post from Daniel Carr and his links here, show the political and protectionist attitude behind this.

    The per centage of allegations against Uber drivers is massively less than against other cab drivers yet the safety aspect is played out as the main reason.

    I smell something dirty here .

  • @Lorenzo Cherin – “…and defend their right to get more time to get their house in order …”

    The trouble is that they were put on notice several months back, after a previous period of poor progress on getting their house in order, and after a considerable amount of time, they haven’t. It is noteworthy that Uber’s complaint about the TfL decision and change.org petition isn’t to ask for more time…

    I think part of the current problem, is that as a result of the TfL announcement, many people have woken up and having missed the beginning of the film and the key plot points, have taken sides – the authorities must be in the wrong because Uber is new etc., and hence believe TfL have it in for Uber, when in fact they have no real idea what has been going on and how things have got to the current situation.

    Daniel Carr’s post omits the following article from April 2016: More than 400 London cab drivers charged with crimes last year

    What is clear TfL (like other licencing authorities such as Rotherham) have a massive problem with passenger safety. It is natural given that Uber effectively employs and thus controls 40,000 of the circa 63,000 private hire vehicles in London (compared to the 21,000 black cabs) that it will be a target in any campaign to improve the quality of drivers and passenger safety; particularly as Uber has demonstrated both in London and other cities around the world it plays fast and loose with regulation, employment law and paying taxes.

    Also given the current processes for vetting black cab drivers, I suspect another reason for TfL to go for Uber, is to prevent drivers who fail to make the grade, from simply working for Uber – once Uber’s contracting process etc is rigourous, it becomes much easier to sort out the rogue black cabs and push them out of the market altogether.

  • paul barker 25th Sep '17 - 3:40pm

    Me again.
    I am not the only one who sees this as a purely Political decision, dressed up as administrative action, The FT has been making the same point.
    I get that London uses up more than its fair share of money & airtime & that this is London issue of little interest to outsiders.
    My frustration is that London is Labours Heartland & a place where we have been traditionally weak. We have 20,000 members in London, Labour have 120,000. However much our Local performance improves I expect us to get squashed in the London Borough Elections next May.
    This issue raises one of the clearest differences between Liberalism & Labourism & affects mostly younger people. Of the 500,000 signing the petition in support of Uber my guess is that 400,000 will be Labour supporters & Corbyn admirers – this was a great opportunity to sow seeds of doubt in their minds & get them to think about Liberalism, an opportunity lost through timidity.
    As a general point we need to be taking risks & annoying “Interest Groups”.

  • “Of the 500,000 signing the petition in support of Uber my guess is that 400,000 will be Labour supporters & Corbyn admirers”

    Err no Paul, the problem is the change.org platform, where the only requirement is to provide an email address that is capable of receiving a verification email. As demonstrated on the UK gov e-petition site, these services are very easy to fool. Hence at the present time all we can say is that circa 500,000 verified email addresses have been attached to the Uber petition. There is no information linking these email address to either real-world people or people living in a particular locale. Hence we need to be cautious in our speculation about who might have signed this petition.

    “… that this is London issue of little interest to outsiders.
    In fact, given Uber are a national operation, the causes for concern TfL are alleging over the Uber London service, give grounds for the Department of Transport to get involved. Because it can reasonably be assumed that any issues, particularly over driver vetting and passenger safety, in London are likely to also be the same everywhere else in the UK that Uber provides services and hence the government should be looking to see if there is a need to direct and/or override local licencing authorities.

    We also need to be cautious because as you and others have noted Uber gets used alot by young people and women out late. We (ie. the regulatory authorities) have a duty of care to ensure services are safe. Remember we tell our children not to talk to strangers, not to get into cars with strangers and not to meet with strangers we’ve only met on the Internet, yet with Uber (and other apps) we are effectively saying to these people it is okay to arrange to meet a stranger from the Internet and get into their car.

  • Malcolm Todd 25th Sep '17 - 5:12pm

    paul barker 25th Sep ’17 – 3:40pm
    “This issue raises one of the clearest differences between Liberalism & Labourism & affects mostly younger people.”

    If I thought that was true, I would think it a definite strike in favour of “Labourism”. In fact, I think it might be true; it depends what you think “Liberalism” is, and part of the problem this party has is that for some people it really would be in favour of letting Uber be “free” to compete, and let the market sort out any problems rather than stodgy regulatory bodies with their susceptibility to vested interests. I don’t think that’s what most Lib Dems think; whether that’s because they have a better or a worse understanding of what Liberalism “really” means, I leave to those philosophers who give a toss.

  • Uber consumers rate their driver (as do driver’s their passengers) and my impression is this is usually based on how soon they turn up, how friendly the driver is, whether the driver plays music or offers chewing gum – all seen features, but I wonder how many rate on the basis of how safe they thought the driver was?

    While Uber has its place in London (though I don’t fully see the point in less busy and less expensive cities/towns) if they aren’t fulfilling the terms of their license then their service should be paused until they are able to do so fully.

  • At risk of stating the obvious, Uber has a lot going for it, or it wouldn’t be popular, but they have been asked, repeatedly, to improve how they address various licensing issues, and have failed to comply. I hope that this will give them the motivation to actually do what was requested, rather than rely on their very large PR team.

    We can’t ignore the fact that a number of black cab and drivers resent the competition, and many of their complaints are about protecting their own share of business. It is absolutely relevant that much of what Uber does is good for the safety of many lone travellers who wouldn’t bother with a more expensive black cab, but that doesn’t mean all concerns can be presumed to be invalid, or that they can be swept under the carpet.

    My understanding is that so long as there is an appeal pending, that Uber get to keep their licence, so fans of the service still get to use it, but there are other taxi firms out there that can do better for everyone.

  • Martin Smith 27th Sep '17 - 11:22am

    interesting piece , having listened to people go head to head on the radio you have managed to do what they failed, you have shed some facts on the matter. I am a pro market person but there are limits and to be honest i feel TFL are in the right here. A basic rule such as criminal record checks are not there to hinder but to protect at a basic level. Do i want my daughters driving around in a cab with some one who has not been checked?

  • Nonconformistradical 30th Sep '17 - 5:41pm

    Blog posting on this from Liverpool LibDem Councillor Richard Kemp at https://richardkemp.wordpress.com/2017/09/30/uber-the-role-of-the-regulator/

  • Laurence Cox 5th Oct '17 - 1:35pm

    There is evidence that the figures from Uber just don’t add up. Read

    https://www.londonreconnections.com/2017/understanding-uber-not-app/

    first and then go on to the following post:

    https://www.londonreconnections.com/2017/making-driver-maths-work/

    There is clearly something wrong with at least one of the numbers. I am more inclined to trust what Uber have reported to Companies House, as the penalties for making false returns are severe.

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