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What is Uber doing to SA's cab industry?

2014-08-07 15:22

TAXI APPS ON THE RISE: Uber is among a number of taxi apps which are being deployed in cities such as the USA and is available locally. Image: Paul J Richards, AFP


Uber taxi strike

2014-06-12 08:37

Taxi drivers brought parts of London, Paris - where this video was shot - and other major European cities to a standstill on Wednesday (June 11 2014) while protesting against new private cab apps such as Uber which have shaken up the industry. Watch the video!

Emma Thelwell, News24

Cape Town - Is Uber’s mobile phone app just a “new toy” on the market or does it have the potential to change South Africa’s cab industry?

South Africa was Uber’s only African outpost until two weeks ago, when it hit Lagos in Nigeria.

Since its launch in 2009, Uber has spread to 145 cities across the globe - much to the alarm of cab drivers in London, New York and beyond.


In June, thousands of cab drivers blocked roads in Paris, Madrid, London, Milan, Berlin and other cities in protest against the rise of services booked using smartphone apps.

Why is there such opposition to Uber?

Unlike traditional cab groups, Uber doesn’t own a fleet of licensed cars. It’s a software company with a mobile phone app that connects people with a pool of private drivers.

Traditional cab drivers argue that as a software group, the rules and regulations surrounding the cab industry don’t seem to apply to Uber.

Craig Robinson, a director at the meter taxi call centre SACAB, explained that Uber drivers can be anyone, they don’t need licences.

He said: “The reason they are upset in London and New York is that taxi licences cost so much. In New York they are worth from $350 000-750 000.”

Plus, the drivers don’t have fare meters, which are subject to regulations.

How much of a concern is it in South Africa?

South Africa’s city centres are rife with unlicensed vehicles. Almost one in 10 cars on South Africa’s roads are unlicensed or unroadworthy, according to the vehicle inspection group Dekra.

Yet how many of these are running as illegal cabs? We don’t know. In fact, we don’t even know how many legal cabs there are on the roads.

Robinson said we are “miles away” from having enough licensed cabs on the road.

He added: “The market isn’t even close [to being as saturated] as New York or London. Taxi services in South Africa are almost non-existent.”

But, he said, there has been “phenomenal growth” of cab services in city centres.

Amid this growth, the whole industry is facing a “regulatory dilemma”, according to the chairperson of the Western Cape Metered Taxi Council, Aldino Muller.

Muller said the issue of illegal cabs “almost always turns out violently within the taxi industry”.

How does Uber change anything?

As far as Uber’s Cape Town general manager, Anthony Le Roux, is concerned - setting up shop in South Africa was “almost a no-brainer”.

Le Roux said: “Our end goal is to be anywhere in the world where there’s a need for reliable, safe cars.”

For Muller, this is a problem.

Though the Uber app is legal, he said more questions need to be asked about how safe and reliable the cars are - and if the operators meet the regulatory standards set for a door-to-door service.

Robinson is less concerned: “In South Africa, Uber is not going to take away any business. It’s all good for us as the more taxis there are, the more people will talk about it and use them.”

South Africa’s cab services are still in a phase of growth, he said, adding: “In the last 10 years, transport has improved - suddenly we have buses, trains, people becoming more mobile and needing cabs. There has also been an increasing awareness of drink driving.”

The growth hasn’t gone unnoticed by regulators, with Muller pointing out that in the Western Cape, the local government has been working on a meter taxi rationalisation plan  which is due to present to its portfolio committee on transport “within the next week”.

Other cab apps

Meanwhile, Uber is not the only cab company with a mobile phone app on the market. There’s Unicab, for example.

While Uber’s status as a software group raises regulation issues, Unicab is a transport company, whose vehicles are all licensed and owned by them.

Unicab’s chief executive officer, Unis Khan said: “With all new toys there is a hype of excitement...if Uber meets [the industry] standard then they are just another competitor who has entered the market.”

Le Roux said Uber was “working with policy makers” but in the meantime expects that there will “always be some pushback from larger operators”.

Engaging policy makers is key, Muller said, “rather this, than allow the street to engage in open debate”.

Certainly, when London’s cabbies took to the streets in protest, it backfired spectacularly.

While the Black Cabs switched off their engines and gridlocked London, Uber fired up its engines and saw the number of people downloading its app increase by 850% on the previous week.

Read more on:    uber  |  durban  |  cape town  |  johannesburg  |  transport

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