“A city with Uber will be a more prosperous city.” So spoke Uber CEO Travis Kalanick on his company’s fifth anniversary last June.
At the time, the ride-sharing service had 26,000 drivers in New York, 15,000 in London and 22,000 in San Francisco.
In Vancouver, however, there are none. Uber continues to hang in limbo in B.C., with a moratorium on the service now in place for the last 18 months.
Vancouver is hardly alone. Cities across Canada have struggled to find ways to regulate the service, and have seen heavy pushback from taxi drivers. Even in Edmonton, which became the first Canadian city to legalize Uber in January, the service was suspended at the end of February because the province hadn’t yet put in place an approved insurance plan.
Uber briefly operated its luxury sedan service in Vancouver in 2012, but withdrew from the city shortly after the Passenger Transportation Board caught wind of the operation. The city put a moratorium on new taxi licences in October 2014.
But now, B.C. Premier Christy Clark has appointed Peter Fassbender, the minister responsible for TransLink, to consult with municipalities about how to approach and regulate Uber in the province.
And with those consultations underway, a UBC student report presented to the City of Vancouver last October sheds some light on the advantages and risks of different regulatory frameworks.
The report was completed as part of the Greenest City Scholars Program, a collaboration between UBC and the City that sponsors graduate students to work on sustainability projects with the City.
Treating Uber as a taxi company, the report finds, is often problematic because “Uber has a history of disregarding local regulations.” That’s because Uber considers itself a technology company, and therefore believes it’s exempt from taxi regulations.
Creating a new regulatory category for Uber is the most popular approach in the United States, according to the report, though it requires “significant research and analysis.” Experts have argued that this option allows for the most flexibility and control over the industry, while encouraging innovation.
The report also makes a case for the creation of a ride-sourcing transportation impact fund, which would require Uber to contribute a percentage of its revenue or a set rate per trip. The fund would be used to improve transportation and accessibility, or to help the taxi industry.
Though ride-sourcing may seem inevitable in many Canadian cities, the report also showed that the public is still very divided on the issue. Surveys conducted in Montreal, Edmonton, Toronto and Ottawa found a fairly even split between those who support Uber and those who’d like to see it banned.
And taxi companies aren’t likely to accept Uber without a fight. The report includes a potential cost comparison between Uber and regular taxis, and found that the uberX service would likely be significantly cheaper than conventional taxis in Vancouver.
Uber has made a dramatic economic impact in many cities, and often to the detriment of taxi companies. The report mentions that one study found that taxi trips decline by 10 to 25 per cent within two or three years of a company like Uber entering the market. Ottawa taxi drivers have also reported a 25 to 30 per cent decline in take-home pay.
In January 2015, Uber published a new study showing that the company added 40,000 new drivers in the U.S. in December 2014 alone. At the time, it estimated that the company had 160,000 drivers across the country.
And last December, Uber announced it was looking to investors for another round of funding, reportedly seeking a valuation of $62.5 billion. That would make Uber more valuable than Ford or GM, according to Business Insider.
Now, the B.C. government seems to have decided that ride-sourcing is here to stay. “All of that sharing economy is catching up with us, and it needs to be regulated,” Clark told the Globe and Mail in January.
And the reality is that it’s not just Uber anymore. In fact, the company may face stiffer competition the longer it’s kept out of Canadian cities. For instance, while Uber has been off the Edmonton market, a new company called TappCar has sprung up in its place. The company is a sort of hybrid between Uber and conventional taxi services, which allows it to operate while Uber cannot.
TappCar spokesperson Pascal Ryffel told Global News that the company addresses concerns both about the level of service of conventional taxis and the safety of ride-sharing services like Uber.
“We fill a niche because we fall right in the middle,” he said.
It remains to be seen, then, whether Uber will come to dominate the ride-sharing sector in Canada, as it has elsewhere, or whether it will become just one of many ride-sourcing options. And all that’s assuming, of course, that Canadian jurisdictions do eventually follow in Edmonton’s footsteps and legalize it.
By Maura Forrest
14 April 2016
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