Thursday, 8 May 2014

On the disruption of the taxi business


Plenty has been written about ridesharing and applications such as Uber that are disrupting the cosy taxi business. I take the view that, subject to insurance and roadworthiness, there shouldn't be barriers to entry - a view that the hackney licensing business (a nice earner for local councils and a fixed market for taxi companies) doesn't share.

However, I was fascinated by the response of London's Licensed Taxi Drivers Association (LTDA) to the decision by Transport for London (TfL) not to intervene in the use of the Uber application to set private hire fares. The LTDA argue that this is tantamount to having a taximeter, which would be illegal.

So the LTDA intend to take direct action and 'blockade' the city to protest at TfL allowing the use of Uber:

"Transport for London not enforcing the Private Hire Vehicles Act is dangerous for Londoners," Steve McNamara, LTDA's general secretary, told the BBC.

"I anticipate that the demonstration against TfL's handling of Uber will attract many many thousands of cabs and cause severe chaos, congestion and confusion across the metropolis." 

There are two possible reasons for this decision: either the LTDA believe direct action will work or else they know that taking legal action won't. Which is important because the complaint is about how TfL has interpreted the law and the place to establish whether they have acted properly should be the court not Piccadilly Circus.



Curmudgeon said...

I'm not an expert, but I can't help thinking that private hire firms outside London already provide much of what Uber do, including metered fares and set fares agreed in advance.

Is there something different about the legislation applying in London?

Simon Cooke said...

The rules are different in London - however most private hires don't have meters even outside London (but agreeing the fare before travelling is normal)

Curmudgeon said...

AIUI for a long time private hire was completely unregulated in London, whereas it was in the rest of the country.

The private hires I regularly use in Stockport have meters, but also offer standard fares for airport trips and the like. I call one via mobile phone and then get a text when it's approaching my location specifying what kind of vehicle it is. In general they're pretty efficient. I don't see what Uber offer that makes a big difference - maybe their business model is geared to cities that only have Hackneys or the equivalent.