Here’s a new mini-crisis for Uber’s new CEO: Transport for London, the taxi regulating service in London, has announced that it would not be renewing Uber’s license to operate because of concerns over the company’s “lack of corporate responsibility” in relation to public safety issues.
The ride-hail company, which launched in London in 2012, is appealing the TfL’s decision and will be allowed to continue to operate until a court makes a decision on that appeal. That process could take months.
London is a significant market for Uber: The company says there are 40,000 drivers and 3.5 million riders on its platform in London. And like New York City, it is one of the most regulated markets where Uber operates. Unlike most markets across the U.S., Uber drivers in London and New York City are required to participate in government-administered background checks.
In the meantime, the company has begun to employ an old trick of the trade and is circulating a petition to London Mayor Sadiq Khan asking him to reconsider the ban. It’s a tried-and-true method the ride-hail company has used when facing regulatory issues in the past. The company has often touted mobilizing its customer base to fight for its service as one of the key enablers of its legal status across the U.S.
Already, the petition has garnered more than 500 000 signatures.
In announcing its decision, the TfL cited its concerns over how Uber’s London arm handled reporting criminal offenses that occur during its rides as well as its use of its so-called “greyball” software tool designed to evade local authorities. But Uber London general manager Tom Elvidge said greyball was never used in London “for the purposes cited by the TfL”. (We’ve asked Uber if greyball was used in London in any capacity.)
“Drivers who use Uber are licensed by Transport for London and have been through the same enhanced DBS background checks as black cab drivers,” Elvidge said in a statement. “Our pioneering technology has gone further to enhance safety with every trip tracked and recorded by GPS. We have always followed TfL rules on reporting serious incidents and have a dedicated team who work closely with the Metropolitan Police. As we have already told TfL, an independent review has found that ‘greyball’ has never been used or considered in the U.K. for the purposes cited by TfL.”
While Uber has seen surprising growth in places like Mexico, which is now one of its biggest markets, the company has come up against regulatory issues and strong local competitors in places like Europe and Asia.
Most recently, the company merged its Russia business with local competitor Yandex Taxi in an effort to end the uphill battle for market share. Uber also pulled out of Denmark in March as a result of new taxi laws that required its drivers to put taxi meters in their cars.
“By wanting to ban our app from the capital, Transport for London and the Mayor have caved in to a small number of people who want to restrict consumer choice,” Elvidge said. “If this decision stands, it will put more than 40,000 licensed drivers out of work and deprive Londoners of a convenient and affordable form of transport.”
Uber has said it will cease operations in Quebec next month after the Canadian province passed new regulations that the company opposed. The decision to pull out of Canada’s second most populous province comes as Uber is battling a decision by London officials to revoke its license, dealing a blow to new CEO Dara Khosrowshahi’s effort to rebuild the company’s image.
Uber has also experienced a fair number of troubles in South Africa – particularly Johannesburg, where cars have been set alight and drivers attacked.
Regards, Uber has shown growth in the region. Data released this week indicates that:
- Johannesburg – Uber had 174,000 active riders from 57 nationalities. Of the trips undertaken, 87% had a wait time of under 10 minutes.
- Cape Town – Uber had 112,000 active riders from 60 nationalities. Around 90% of trips had a wait time of under 10 minutes.
- Durban – Uber had 31,000 active riders from 47 nationalities, and 88% of riders experienced wait times of under 10 minutes.
- Port Elizabeth – There were riders from 21 nationalities, and 67% of trips had a wait time of under 10 minutes.