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As always, popular car-hailing app Uber is rubbing some people up the wrong way. Over the past few weeks, the San Francisco tech company has been making headlines in Cape Town, South Africa, with cars getting impounded to protests in the streets. It seems like a classic tale of new technology versus old law, though the disruption reaches far deeper.
The Metered Taxi Council of the Western Cape is calling for the service to be shut down. The council argues that the US$40-billion ehailing service is currently flooding the market with illegal operators, and that this monopoly does not bode well for the drivers who aren’t signing up.
“Given the laws and regulations, it’s easier for taxi drivers to be illegal than legal,” explains Aldino Muller, the chairperson of the Metered Taxi Council.
According to Muller, drivers find themselves doing a legal limbo. On the one hand, he says, they see all their business opt for the Uber alternative and, on the other, they sign up for Uber but have to operate without the required permits and risk getting fined between R7 000 and R15 000 or getting their cars impounded. It’s a Catch-22 really.
“Uber and similar services have been responsible for more than 50% of the market,” Muller says. He also points out that there has been no negotiation from Uber’s part since it launched, and that it’s just “stealing” an existing market that existing taxi drivers took very long time to build.
Transport in Cape Town, especially when it comes to the taxi industries, has always been a sensitive issue. It’s a fragmented industry with tensions climaxing in events such as the minibus taxi violence in 2013 — a different sector but a stark reminder of how intense things can get in the transport space.
The Metered Taxi Council — which represents between 2 500 and 3 000 metered taxi drivers — warns that there will be more protests if the city doesn’t clamp down on the service.
Uber has been quietly growing its brand among both drivers and passengers since it launched in August 2013 in the Mother City. It only recently announced that it has had over 2 000 drivers signed up between Cape Town, Johannesburg and Durban.
“Endorsing Uber is the same as buying pirated movie copies,” Muller tells us. “Like everything else, it must adhere to regulation.”
Action against Uber has mainly been involved hundreds of drivers marching and cruising through the streets of Cape Town against Uber and, Muller notes, other “illegal and pirate taxis”.
But given all that it’s been through around the world, Uber is not about to roll over and play dead either.
Anthony le Roux, who heads operations for Uber in Cape Town, says that Uber’s all about keeping Cape Town moving. “The Uber system provides a safe reliable and flexible solution. We’ll continue to grow the business,” he says.
He argues that the Uber model is much more efficient and offers flexibility for the drivers and customers. Le Roux points out that even though the city’s driver’s permit requires vetting, Uber found that between 15 and 20% of the drivers who wanted to become Uber affiliated were refused either because of dodgy criminal backgrounds or for simply being unfit.
Le Roux states that, as is the case with Gauteng drivers, Uber’s operations should for the interim fall under the charter service category. This would allow it the flexibility to operate legally until the new by-laws are implemented.
The Metered Taxi Council, however, says that Uber must adhere to existing regulation and the city should not look to “legalise illegals”. Muller also argues that the city of Cape Town “must not give them avenues to operate”.
More competition means more choice
“Uber enjoys a competitive market, which means the rest of the taxi operators will need to up their game. Ultimately, this means that the customer will end up winning,” says Le Roux.
One such local operator already staying ahead of the curb is Unicab. The 25-year-old operator launched an app that’s similar to Uber’s a few months ago, which passengers can use to plan their trips.
The company’s marketing manager Lee Kassim says that it “doesn’t have a problem” with Uber. He notes that even though the tech Uber’s using is fantastic, “Unicab will be launching a new app within the next two weeks that’s on par with the international market through a new partnership”.
One of the features that will make Unicab’s app so special, Kassim argues, is the fact that people can pay their fares without credit cards. The service then hopes to increase its marketshare by allowing people to pay with a debit card as well as cash.
One good thing that comes from these debates and protests is the fact that it forces service providers to stay ahead of the pack — Muller tells us that the council is looking at introducing three new potential technologies in the future.