LOCAL CAB: How does the new Uber and Autocab product work and why still the outcry?

Uber’s new product, ‘Local Cab’, which enables passengers to book a trip with a local taxi company via the Uber app is now going live in cities and has provided a first look at the functionality that is dividing opinion throughout the taxi and private hire industry.

The Local Cab option uses Autocab’s iGo network which has been integrated onto the Uber platform for the first time since the two firms controversially reached an acquisition agreement in August 2020.

The first three pilot launches, in Plymouth, Oxford and Exeter respectively, have provided the first glimpse into how the Uber and Autocab partnership might work

moving forwards. According to sources, the integration has the potential to connect passengers with 80,000 private hire and taxi drivers in the UK.

HOW IT WORKS

The user opens the Uber app the usual way and enters their trip details. They would then be asked to choose the Local Cab option from the drop down where an estimated price from a local cab operator is displayed.

If the user wishes to take up the option, Uber would then locate a local cab operator for the user to book with, and send them their contact details to help them complete the trip.

The local cab operator would then accept the booking and provide the trip. Cashless payment is made via the app as usual.

Uber say that whilst the booking is made with a local operator, the user will receive the driver and vehicle details in the Uber app as usual once the booking has been confirmed. The driver’s ETA and the local operator’s number are also provided, so the passenger can contact them if needed.

As part of the deal Uber will take a small service fee on each Local Cab trip.

ARE THERE STILL CONCERNS WITHIN THE INDUSTRY?

Quite simply... yes.

Despite the Competition and Markets Authority (CMA) announcing that it had cleared Uber’s purchase of Autocab following a merger investigation, concerns remain from several quarters about how the user and booking data is used.

Bob Nixon, iCabbi Co-Founder, told TaxiPoint: “In our view absolutely nothing has changed.

“The CMA ruling on the threat to Autocab's taxi company customers data was very clear and still stands. We believe that the taxi/PH operational model is being reshaped by Uber's acquisition of Autocab and this represents a fundamental threat to the traditional taxi and private hire industry in the UK.”

Steve McNamara, General Secretary of the Licensed Taxi Drivers’ Association (LTDA), had concerns over the merger highlighting the CMA’s response to previous issues.

McNamara said: “The fact that the CMA cleared the merger is far from a surprise. The CMA have a long history of ignoring Uber’s price fixing, artificial pricing and anti- competitive business model.

“I would have been amazed had they took any other position.”

TaxiPoint asked Autocab’s CEO Safa Alkateb whether any booking and journey data would be shared between Autocab and Uber in a recent interview. Alkateb responded: “Uber will put in place everything that is required to protect Autocab’s customers’ data, ensure that it is not misused and is always managed under all applicable laws and the terms of their contracts with Autocab.”

An online panel was specially put together by Dotted which included several senior representatives from the taxi and private hire sector to discuss the issue. These included, Bob Nixon, Thomas Peyerl (Cordic CEO), Alan Sceeny (Cab9 General Manager), Steve Wright MBE (LPHCA Chairman) and Ian Shanks (Blueline Taxis Group CEO).

A couple of weeks after the event, Uber set about to reassure Autocab customers by releasing a statement on the questions raised. It said: “Earlier this year Autocab was acquired by Uber, which has led to some questions from within the industry. We want to answer these questions and give Autocab customers the reassurances they deserve.

“When the CMA cleared the acquisition, they concluded that the deal did not give rise to competition law concerns. We agree, and believe it is positive for competition.

“The deal will help cement the place of local operators in their community. Consumers will easily be able to access a local cab, and operators and drivers will have greater earnings opportunities.

“We understand the importance of protecting Autocab’s customers' commercially sensitive data, not only because it is imperative that we are always fully compliant with the UK’s data protection laws, but also because we know that protecting this data is key to our, Autocab and their customers’ success.”

Dr Mike Galvin, a taxi industry and mobility consultant from Mobility Services Limited, said: “Uber appears to me to have always wanted to work to its own rules, it appears to have been frustrated by the, admittedly idiosyncratic, licensing framework. This latest move appears to put Uber exactly where they want to be – unbridled and unconstrained by laws, at the extreme. Written for horse drawn carriages and more recently prior to the internet, mobile phones and apps, they are now free to generate bookings based on their own playbook.

“I have little sympathy for those who ‘are worried’ about ‘their data’. If they are so worried about their data then find a new booking and despatch provider... there are plenty of them.

“Despite many politicians falling over themselves to welcome this ‘new business model’ (sic) to the UK it hasn’t managed to dislodge the incumbents to any great extent. After pouring fortunes down the drain what is clear is the ‘business model’ has not been an unmitigated success. Most incumbent cab companies remain in place despite the money that has been hurled at their towns and cities. My advice to the industry is the old maxim of ‘keep calm and carry on’. Look after your customers, look after your drivers, and take work from wherever it comes from.

“Will this latest pivot turn Uber into a raging success? The jury is out but I suspect it won’t be out long. Until the industry returns to a point where costs including marketing are lower than income and profit comes back into fashion as a concept none of these schemes are going to fly. Buying something for a pound and selling it for fifty pence is not a business model!”

As the debate continues, time will tell whether the new product aids or diminishes local operators throughout the UK.