Uber AutoCab Buyout/Takeover – August 6 2020
So here are my thoughts on the’ Uber AutoCab Buyout/Takeover’ and I have to make it clear these are my own personal thoughts... but I do believe I have been around long enough in the trade to be qualified to be very sceptical.
My qualifications and expertise are that I have been a Brighton & Hove hackney carriage proprietor in for some thirty-eight years and I am a member of a local taxi company that is run as an association/cooperative for eighty years and I take a very active part as a GMB trade union rep. I must stress at this point that the following observations I have made have nothing to do with the GMB as these are my own personal thoughts and I write purely as a well worn and cynical cab driver.
Now... I know very little of all the ins and outs of the deal although I have been getting snippets here and there of which some may be true or indeed not but I do have a copy of the email sent to an AutoCab user which has also been circulated on the net so let’s have a look at that and take each statement. I have also added some comments for a little fun:
“I’m thrilled to share that in the next few hours, we will announce that Uber has acquired AutoCab. ”
Comment: ‘We have sold our soul to Uber’
“Please join us this afternoon, Thursday, at 14.30 (UK time) on Zoom for a webinar during which we would like to talk through the growth opportunities this presents for your business. You will need to register in advance – Please aim to join us from 14.20 so that we can begin on time.”
Comment: ‘We have sold our soul to Uber and we want to take yours as you will now be a proud Uber Partner!’
“I’m sure you have a number of questions, which will be addressed during the webinar. However, in the meantime, please find below some more information.”
“Will AutoCab remain an independent company?”
“Yes. AutoCab will continue to operate as an independent company with its own board of directors.”
Comment: ‘But having sold our souls to Uber we will more than likely be directed by what Uber wants otherwise it would be a waste of time and money for Uber’
“AutoCab’s mission remains the same – we will continue to provide our SaaS technology platform to the taxi and private hire industry. We will also continue to offer the iGo network and marketplace to ensure more jobs for taxi and private hire operators.”
Comment: ‘You will have to pay Uber (currently) 20% of the fare for each job which could have been your own job in the first place!’
“The only thing that will change is the scale at which we operate – AutoCab will look to expand beyond the 33 countries where we are present and approach business with a global rather than regional outlook. This means that we can look forward to big international growth which in turn will lead to even more innovation and investment into our core tech products which will benefit all of our customers.”
Comment: ‘We have already been trained in ‘Uber-Speak’
“Why did Uber invest in AutoCab?”
“Every month thousands of people open the Uber app in places the company doesn’t operate to try to get a trip. Uber hasn’t launched a new city since 2016 and through AutoCab’s iGo marketplace, like other existing aggregators, Uber will be able to connect these riders with local operators. In turn, operators should be able to expand their operations and offer more earnings opportunities to local drivers. We believe there are additional revenue opportunities related to our platform for other services, such as delivery and business trips. ”
Comment: ‘Uber will be taking your work that you already have because at the moment if an Uber customer tries to use the Uber app in certain areas that Uber does not operate and can’t get a cab then they would probably use a local cab company. So in effect allowing Uber to serve those customers using the Uber App Uber will then be selling that job back to you that you would have probably got in the first place. We hope that makes as much perfect business sense to you as it does to us!
What does this mean for iGo?
“Uber will be joining the likes of CMAC, Brunel, Addison Lee and Mozio etc. as a demand generator/aggregator by directing additional trips to our customers.”
“Following Uber’s lead, we expect to see other major players follow suit, including the likes of global airlines, train operators, major B2C travel booking platforms and B2B travel management companies who are generating trips from around the world, that need to be fulfilled by local licensed operators.”
Comment: ‘We really are getting good at Uber-Speak... aren’t we’
“What does this mean for my business?”
Comment: ‘Shrinkage! Because we are selling you back your customers... good init!”
“AutoCab’s mission has always been to encourage local private hire and taxi operators to transform their businesses. This deal will help accelerate AutoCab’s global ambition and the growth of our customers’ businesses.”
Comment: ‘We have sold our soul to Uber and made a quick buck and we wish transform your business to eventually be dictated to by Uber in its goal to take over the world!’
“What does this mean for my drivers?
In a nutshell, more work, if you want it. Uber, together with other corporate and blue-chip demand partners will be directing significant additional demand to your business supplementing your own trips – which means less dead miles for drivers and greater weekly earnings potential.”
Comment: ‘In a nutshell deductions on the fare! For example the AutoCab companies will be paying Uber 20% of each fare passed on from Uber....... sorry...... I mean for each fare of what would have probably been your job in the first place that Uber is selling back to you there will be a 20% charge for the privilege (insert smiley face here)
Do I have to take Uber’s work?
“No. It’s opt-in.”
Comment: ‘Hey this is Uber we are talking about so you may be able to opt in now by choice but why leave yourself out... we are going to take over the world and we want to take you with us. In effect we want to take over your world too!’
“Will Uber have access to our customers’ data?”
“No. Our customers’ data belongs to our customer, in line with GDPR”
Comment: ‘Come on... this is Uber we are talking about that has been taken to court all over the world!’
“How will this all work?”
“Join us at the webinar and we will take you through all of this in detail.”
Comment: ‘Join us at the webinar meeting where we can demonstrate our new Uber-Speak!’
That of course was just a little bit of fun but I wonder how many of the local Cab Companies who are AutoCab customers choked on their cornflakes this morning when they got that email on August 6 from AutoCab?
But stay with me......
This is from the August 2019 editions of Private Hire and Taxi Monthly which was written by By Hassan Abod Director at Autocab.
“Uber’s story is well known – the company shot to fame in 2012, following a soft launch in London and a swiftly executed PR campaign. In what felt like an overnight surge, the app started to win over thousands of customers in major UK towns and cities. It quickly became a popular method of travel due to its ease of use.
As a technology company first and foremost, and a transport business second, the resulting clashes with the ‘traditional’ industry have perhaps not come as a surprise. Safe to say that the taxi industry has had a fight or two on its hands in trying to ensure it can fairly compete with Uber.
Despite Uber’s appealing service offering, it’s far from perfect – both from a driver and customer perspective. So, what should you say to your next customer who asks what you think about Uber, and whether they should use it?
Different reasons will strike a chord with different people, but here are five main ones you can lead with when you next get the chance.
1. LESS SUPPORT FOR YOUR LOCAL ECONOMY
While thousands now drive under the Uber banner, the technology company is technically supported by an army of freelancers. This means that Uber will never be a reliable employer in the local community, as it is unable to offer the same employment rights as a traditional taxi company. There’s your first argument in a nutshell.
2. YOU CAN’T USE IT EVERYWHERE
Uber’s strategy has always been focused on high-profit, urban areas which present the best opportunities for converting customers and drivers quickly. Of course, the result of this approach means that there are plenty of locations across the UK which aren’t catered for by the ride-hailing app. Residents in many areas will never have had the option of ordering an Uber from their home. Add to this the fact that customers can now use a single app, provided by their local taxi company, to order a cab virtually anywhere in the country, and then Uber does start to lose its appeal. An app that can help you get about wherever you are, seems like a better option. The iGo network, powered by its ready to use white-label app and job-sharing capabilities, really is a game-changer for local firms in this respect.
3. UBER CAN’T DEAL WITH TRIP COMPLEXITY
It goes without saying that most taxi companies have spent years building and maintaining long term relationships in their local communities. Aside from customers who will defer to their preferred taxi provider every time they need a ride, there are many customer relationships that are much more than a one-off.
From children with special needs who need to be picked up and taken to school every day, to corporate hotel partners who will always send work your way – customer relationships are at the heart of the service taxis provide. Uber simply can’t cater to this trip complexity. Long-term relationships and agreements can never be established when every ride is provided by a different driver.
4. INCENTIVES DON’T LAST LONG
We’re all aware of Uber’s strategy now. Low journey prices and incentives provided for new customers and drivers to sign up – with the end goal being to flood the market. This strategy only works for so long, however. Once customers realise that their local taxi firm can offer an equally good service with the same technology as Uber, opinions about the ride-hailing giant using may start to change.
5. LOCAL TAXIS ARE BUILDING FOR THE FUTURE
The future of travel will involve multiple modes of transport working together and sharing data to provide customers with a single point of contact. The traditional taxi industry is perfectly suited to start this conversation with other transport providers with the vast knowledge it has of customer journeys across our towns and cities. As data is being gathered by firms up and down the country, that’s a wealth of information just waiting to be tapped into by transport planners.
So if your customer starts questioning whether they should be using Uber, you now have all the information you need to explain why booking via a local taxi firm is the better option. Hassan Abod - Director at Autocab -www.autocab.com”
So pretty much twelve months ago the Director of AutoCab was a strong defendant of local cabs so what has now changed just a year later? More than likely a big fat wedge has made the change... and good for him too!
Back to Basics – A little history
For many years up and down the country there have been long established local cab companies along with new ones opening up and all producing very healthy competition. I remember... whilst looking though my rose tinted glasses... the ‘good old days’ of pen and paper with a dispatcher manually calling out all the jobs on a radio and drivers fighting on the airwaves as to who was nearest the job. All very primitive back then but in those days it worked. Then along comes new technology and computer availability which transformed the way that cab companies could become more efficient. The early 90’s was really the beginning and I was there at the time and many cab companies made up of individual owners and cooperative associations invested heavily in technology evolved every few years. The use of a mobile phone with adapted software came in roughly ten years ago by a company known then as Auriga and various other similar systems at the time although the good old stand alone data unit was the standard feature.
Being an owner member of Streamline since 1985 I know that over the years we spent hundreds of thousands on the latest technology and I know that other companies up and down the country have done exactly the same. Putting this into perspective on a pro rata basis with the income from the subscriptions for a non-profit making company the investment we made was not a small amount. And also taking into consideration that there was no ‘investors’ throwing money at it hoping to make even more money further down the line.
And then Came Trendy Uber
Uber then arrived on the scene around 2012 in London and then appeared in various areas across the country from about 2015 onwards.
It aggressively launched itself as a ‘Disruptive Technology Company’ which was the start of the infamous Uber-Speak which I have witnessed firsthand sitting next to various Uber reps and Uber solicitors here in Brighton & Hove.
Suddenly it appeared that Uber was the new God in the cab business which conveniently wiped out all the investment and hard work that the local companies have strived for to give a good local service.
When Uber was first refused the renewal of its London TfL Operaor Licence we had poor old Fred Joned in the news looking sad and telling Londoners to “Save your Uber” and looking quite stupid... in my opinion. See my dissecetion of Fred Jone here from 2017
And what happened to Fred who was at Uber for five years? Well he has jumped ship and now is scooter boy at electric scooter startup 'Tier'
At one time of being involved in our company advertising one of our slogans I created was ‘Local Not Global’ which was put on all our cabs to try to emphasise that the local companies are here and they can give a great service.
Unfortunately we cannot compete with the advertising of this gigantic predatory international company that has billions of investor’s money being thrown at it that makes the Uber brand trendy.
Ubers Only Advantage
However the only advantage that Uber has had against the local cab companies is that it has an app that works wherever you are in the world. So if you are in Japan you use your Uber app to get a cab to the airports and then when arriving in London all you need to do is use your Uber app again and order another cab. Brilliant! But that is the only advantage which seems to outweigh the major disadvantage of having to pay up to four times the normal rate during the infamous ‘Surge Pricing’ system. To me I just don’t get it because I have to work long hours for my money but this just seems to be accepted as the norm nowadays.... and people had better get used to it from what I foresee is around the corner!
It is well known that Uber does not make money from its commission from cab fares and whilst predatory pricing has always been disputed it must be prevalent otherwise it would be in profit... which apparently it has never been. It has been stated in the media that even if Uber cab journeys doubled it would still not make a profit and the only way to make a profit is for the fares to go up. But if it did that then there would be no point in trying to compete with local cab companies with the ultimate goal of wiping them out.
I am happy to admit that Uber dumping itself on these shores was a wakeup for some companies that lagged behind in the technology field but these very quickly caught up after the shock.
On August 5 2020 a BBC report stated:
“The ride-hailing giant said it had an average of 55 million customers each month in the April-June period, down from 99 million last year.
The fall came despite a boom in its food delivery business, which saw orders more than double.
But trip bookings were down 75%.
That is just a slight recovery from the plunge seen at the height of the lockdowns this spring, when the rides business collapsed as much as 80%”
This is a massive drop in revenue for this company as it would be for any company.
On August 6 2020 Uber announced its results for the second quarter of 2020
Revenue of $2.2 billion, declining 29% year-over-year or 27% on a constant currency basis
SAN FRANCISCO--(BUSINESS WIRE)-- Uber Technologies, Inc. (NYSE: UBER) today announced financial results for the quarter ended June 30, 2020.
Financial Highlights for Second Quarter 2020
•Gross Bookings declined to $10.2 billion, down 35% year-over-year, or 32% on a constant currency basis, with Mobility Gross Bookings declining 73% and Delivery Gross Bookings growing 113% year-over-year, each on a constant currency basis.
•Revenue declined 29% year-over-year, or 27% on a constant currency basis. Mobility Revenue declined 67% year-over-year and Delivery Revenue grew 103% year-over-year.
•Adjusted Net Revenue (“ANR”) declined 33% year-over-year, Mobility ANR declined 66% year-over-year and Delivery ANR grew 162% year-over-year. YoY Growth % at constant currency & ex-Driver appreciation award was (37)% and with respect to Mobility and Delivery, (68)% and 163%, respectively. Adjusted Net Revenue and segment Adjusted Net Revenue excludes the impact of COVID-19 response initiatives.
•Net loss attributable to Uber Technologies, Inc. was $1.8 billion, which includes $131 million in stock-based compensation expense and $382 million in restructuring and related charges.
•Mobility1 Adjusted EBITDA delivered $50 million in profit, down $456 million year-over-year, and down $531 million quarter-over-quarter, and 6.3% margin as a percentage of Mobility ANR.
Lots of the use of ‘declined’ and plenty of minuses as well...
And isn’t it odd that the Uber/AutoCab deal was announced on the same day?
This Second Quarter announcement is clearly a worrying time for dear old Dara who will most probably invent some new Uber-Speak along the lines of:
“These are market challenges that come to us and are the essence of the Uber ideology of not looking at the short term but realising the future is where we want to be”
Ok he hasn’t said that but that is an example of what the Uber-Losers (Investors) have been used to hearing which oddly enough seems to rally them to thrown more money into the Uber Black Hole
However in the Second Quarter of 2019 an actual statement in an interview here with Dara K in Auhust 2019 where he stated he wants to have a $1.50 ride.
He stated: "If you look at our ride share business it covered our overhead less than about 100m dollars"
What he couild not bring himself to say is "We lost 100m dollars"?
From Operator to Aggregator/Broker – Selling the Work Back To The Local Cab Companies
From the information that I have been given it appears that Uber wishes to now become an Aggregator or Broker to the trade which has started with the buyout of AutoCab that supplies a lot of local cab companies up and down the country.
It seems that Uber has looked at AutoCab and has seen a different path that it can take.
Let me invent new terminology for this and call it ‘Uber Evolution’ and Uber can have that for free...
So AutoCab has this large network of cab companies using its software from small ones to extremely large ones and so this infrastructure is all in place for the ‘Uber Evolution’.
I can just see the Uber CEO Dara Khosrowshahi rubbing his hands together and drooling over this massive network of cab companies and stating something like:
‘I’ll have some of that!’
“Lets’ reel them in hook line and sinker!”
‘Let’s sell the work that these companies already have back to them under the Uber brand!’
That may be a cynical view but as I previously stated I have learnt over the years to examine something that looks to be true.
Uber announces plans to connect customers in Swansea with local taxi services Source
"Uber has announced that users who open the app in UK towns and cities where it does not operate will be connected to local taxi drivers.
The ride-hailing company said hundreds of thousands of people open the app each month in places where they cannot request a ride.
The change will make it possible for users to find a journey on the app and pay for it through Uber.
The service will be possible due to the company’s agreement to acquire tech firm Autocab.
Amongst these locations is Swansea, where the firm said 18,000 people open the app to not be able to request a ride."
So this means that people in Swansea who currently use local cab companies will now have the privileged to order the same local cab company via Uber which means that Uber is now selling back those jobs that the local companies had in the first place!
Does Uber/AutoCab really think that local cab companies are stupid? Obviously the answer is YES!
Hospital / Supermarket Freephones/ Station Permits... and such like
With this massive new network of ever waiting cabs supplied by the local companies what is to stop Uber as a new Agrregator from now stepping in and taking these over? So where before the individual local cab companies could compete on a tender basis the well branded Uber will suddenly become the favourite top bidder.
Uber has always wanted to be the the easy transitional transporter that integrates with the railway network so where the railways have usually issued station permits to hackney carriages that rank up at these stations maybe these will now be turfed out.
Keep in mind that it has now joined up with Thames Clippers and eventually it will become one single choice for the public which will be Uber.
Too Good To Be True? Or is it so good that it is really is True?
I understand that the Uber/AutoCab way of working has been explained along the lines that initially when a customer opens the app there will be the choice of an ‘Uber’ or a ‘Local Cab’. I have to take it at face value that this information is correct but I will be happy to be corrected.
Now this seems odd to me? Uber has spent billions on promoting itself as the trendy cab app in brainwashing the public into trusting the Uber brand so why would a local cab company on the Uber/AutoCab network think that the customer is going to chose ‘Local Cab’? This does not make any logical sense?
However I understand that if there is not an ‘Uber’ car available then even if the customer chose the ‘Uber’ option then it will go to the nearest Uber/AutoCab Partner. And I do emphasise ‘Partner’ because that will be what the local cab companies will become by default. They will be associated with the Uber brand for good... or indeed for worse.
So in this scenario the local cab company is now fully supporting the Uber brand as an associate ‘Uber Partner’ which promotes Uber as being extremely efficient... so well done you local cab companies! You have just signed up to what could possibly be suicide by stealth.
Why do I state this? Well..it is so blinking obvious that it seems a waste of time writing this out... but I will.
By being part of the Uber/AutoCab network you are now incorporated into the Uber brand by default... although I understand that ‘at the moment’ a cab company can opt out of the iGo system... for now... and:
You are clearly supporting the evolution of Uber in the UK.
Your independence will eventually be eroded as you mutate into the Uber brand.
You are clearly now working for Uber and will never ever be able to escape.
In fact on the last one here all those individually owned cab companies that have invested in technology... which ironically has been with AutoCab... with the owners probably working extremely hard over the years to promote their own brand will now be working for Uber because once you are in you will never be able to leave.
How will Uber make its money?
It appears that Uber will be charging 20% of each journey that it farms out to a local company... but of course that is 20% at the moment and more than likely when Uber has been handed the power by all those local cab company AutoCab users the rate will go up.
But further down the line this will probably end up being the work that that the local cab companies would have had anyway... and it will end up being sold back to them at a price!
It is also presumed that the fares will be based on local rates. In Brighton & Hove the companies here run mixed fleets of hackney and ph so all fares for both vehicles have been based on the local council controlled fares.
But this isn’t the case for every area. There may be AutoCab user companies which are strictly ph and therefore charge whatever rate of fare sets. It is then presumed that Uber will then allow these fares to remain in place.... for the time being.
If the driver is not on a weekly set subscription then the local company takes a cut of say 10% of the fare. So when Uber then charges 20% of the fare then what is left for the driver after handing back 30%? A bleeding pittance.. that is what!
And when you take into consideration that there are places like Middlesbrough who are right at the bottom of the PHTM ‘Fares League Table’ at 358th place on a ridiculously low rate of £4.40 for a two mile journey ...where other areas at the top are on average of £7.40.. then 30% is a massive amount to hand back.
On August 8 2020 that AutoCab stated on its Facebook page:
“The alternative would be not to work with the industry and instead simply launch in city after city and keep recruiting drivers from private hire firms. Think about it from a driver's perspective now - do I go and work for Uber to only receive Uber work and pay 25% commission on every trip, or, do I stick with my private hire firm and receive their work, some additional Uber work and just pay £100 per week rent?”
Hold on? So as far as Uber/AutoCab is concerned it has now been set that a ‘Speedy Cabs’ driver will be getting the Uber work for free then? So that must mean it will be the cab company that will be paying Uber/AutoCab for the work and not charging the driver by passing on this cost to the driver in any form whatsoever?
Surge Pricing For Local Companies
However although Uber maybe using the local rate of fares what about the Surge Pricing? Will this still kick in because this is how Uber driver currently make up their money? And it has been claimed in the media that Uber drivers have been able to control this by getting together and logging off to show very few cars available which triggers the algorithms to trigger ‘Surge Pricing’. If this isn’t true then blame the media and not me.
And if ‘Surge Pricing’ is used then what happens with those mixed fleet companies that use hackneys as well as private hire vehicles because a hackney can only charge the metered rate within the geographical area of its own licensing authority? And can a hackney on the system not use the meter on the job... or would it be breaking hackney carriage bylaws? Certainly a lot of licensing authorities do not allow the use of a ‘Soft Meter’ that is built into an app because these cannot be checked... calibrated and sealed.
As I stated at the beginning I know very little about the deal and I probably won't be privileged to all the ins and outs although I will most likely get some snippets here and there but as I previously stated that what I understand is that if there is a an Uber customer requesting a cab on the Uber app and there doesn't happen to be an Uber car in the area then that job will be given (sorry, farmed out and sold on)to that local company on AutoCab. But (and this is a big but!) in so doing the customer will remain an Uber user rather than a user of the local Taxi system. Which would have been the case, had the local company not agreed to ‘cover Uber’s work’.
Also if for any reason despite the hundreds of out-of-town cars encouraged by Uber to go into the areas where there is a job that can't be covered then again that job will be given (sold) to the AutoCab user company.
But let us look at the basics here as pretty much all local companies have suffered terribly over the last few months. However... let’s go back even further because local companies have been suffering over the last few years because of Uber in the first place!
Uber Brighton & Hove
Now let's be clear there is absolutely nothing wrong with good healthy competition.
I have done media interviews on Uber here in sunny Brighton & Hove and I have always stated that competition is welcome but what we do not like is unfair competition and with Uber it is the use of hundreds of ‘Out of Town’ (OOT’s) cars that it encourages to predominantly work here who are not accountable to Brighton & Hove Council and who so not have to abide by our conditions of licensing.
This has been repeated throughout the country such is the total disrespect and attitude of Uber in that it really does not care what car covers the job which could be a car licensed hundreds of miles away.
In other words the aggressive Uber-Disrupter has totally destroyed ‘Local Licensing Control’ in the trade.
So where a lot of local companies have suffered is the amount of out of town cars that Uber uses to flood these local areas where these are cars are out of sight and out of mind and out of the reach of their respective local licensing enforcement. Look at ‘Confetti Licensing Wolverhampton’ as an example.
Can Uber be trusted on what it states?
As I am writing from Brighton & Hove I have firsthand experience with Uber landing here in 2015.
With Uber being such a controversial brand with having built up a certain reputation the Licensing Committee here decided to have a Licensing Panel to decide as to whether it would grant Uber an Operator licence.
This is unusual as this is usually delegated to the Licensing Officers in normal circumstances.
So I was at the Uber Licensing Panel meeting in late 2015 and sat through all the usual Uber-Speak but there was one very extremely important question that was put to Uber which was along the lines of:
“Will you only be using Brighton & Hove licensed vehicles in the city?”
And the answer of course was “Yes!”
This is all in the Minutes of the meeting and stated in the letter of acceptance of granting Uber a short term licence.
It took Uber nearly a year to actually start up in Brighton & Hove but straight away in 2016 we saw a massive influx of TfL phv’s flooding the city and soon after we saw cars from places hundreds of miles away such as Sefton and even Leeds where these drivers slept in the cars night in and night out (we have the videos) and cars from Reigate and Banstead and such like. Soon to follow were cars from Portsmouth.. Southampton... Havant... Chichester... and the dreaded Lewes cars from next door soft touch Lewes DC.
Uber even advertised on its website that it was easier and quicker to get a ph licence in sleepy Lewes (next door) than to have to go through the very tough requirements that Brighton & Hove licensing needed.
When Uber was refused the renewal of its licence two years down the line I made damn sure that the council was aware of this and Brighton & Hove Council Licensing Panel brought up this very point although Uber had removed that part from its website a few weeks earlier. The council turned down the licence but Uber won it back in an Appeal in court as I witnessed with the dazzling Uber Barrister Philip Kolvin. Damn I wish he was on our side fighting our corner because he is very good!
Lewes DC then saw a huge increase in ph licence applications.
The DfT included this fact in a report last year for the period between 2018- 2019 where it stated that Lewes saw a massive 91% increase in ph applications and we now have hundreds of these predominantly working in the city out-of-sight out-of-mind of Lewes Licensing Enforcement (if I can call it that) under Uber.
So much for the original undertaking that it would only use Brighton & Hove licensed vehicles in the city!
There are so many of these Lewes ph cars predominantly working here that constantly contravene their conditions of licensing such as missing vehicle livery... missing licence plates... ranking up and even sitting on taxi ranks.. that we are sending daily reports to Lewes Licensing. As such it has not been able to cope to the extent that Eastbourne Licensing which was sharing resources has now had to take over.
Such is the impact of the Uber-Factor which effectively stuck its fingers up at Brighton & Hove City Council despite its undertaking to only use Brighton & Hove licensed vehicles in the city.
So...for all those AutoCab companies who have never experienced Uber in their respective areas be warned! What Uber states is not always what Uber means.. its as simple as that.
Uber Lower Standards
Uber even tried to lower the standards required to get a ph licence in the city. A ph driver licence here requires the same knowledge test as a hackney driver licence such is the standard required.
At a trade meeting I sat next the Uber solicitor who cliamed that “SatNav is best!” Little did she know that I had a screen shot of an Uber TfL ph job details where the route under satnav that the driver took in the city was almost four times as long as it should have been. Fortunately the Licensing Committee councillors effectively laughed Uber out of the room!
Additionally Uber has always been against CCTV in licensed vehicles and has expressed this many times here which is so very odd and questionable?
When sleepy Lewes (next door) revised its conditions of licensing and proposed mandatory CCTV Uber actually wrote in an objected? Quite astonishing!
Local Cab Companies Suffering
The suffering of the loss of trade for local companies is two-fold with the arrival of the Uber virus (London first in 2012 and a couple of years later locally) coupled with the covid-19 virus over the last few months.
Now we have the Uber takeover of AutoCab which means all those local companies that use AutoCab are possibly in a bit of a dilemma and also in an ironic situation because in a lot of cases Uber has been their competitor.... but now they have a chance of being upgraded to an ‘Uber-Partner’.
I believe that I am correct is saying that there are some AutoCab users who have never had to deal with the effect of the Uber impact and these maybe worried that if they don’t work hand in hand with the new deal that Uber will now be a threat to them. My advice is to be brave.
Could all the Autocab customers be looking at this as a life saver with the incredible ‘AutoCab- Uber-Speak’ or could it be looked at being the beginning of the final end of the local cab company?
Uber the well known ‘Disruptive Technology Company’ has been at the throats of the local cab companies since it arrived here and caused a loss of trade because of their only really one advantage of having a single app that can be used all over the world which is very convenient for the punter and of course being ever so trendy to summon an Uber.
Most cab companies over the last few years have spent a lot of money on their own technology and pro-rata probably as much as Uber, using companies like AutoCab.. icabbi... Cordic and so on and have really good apps... but they can't compete on the level of Uber because of this international app, its ‘buying power’ and predatory pricing structure.
So with the Uber takeover of AutoCab along with its determination for world dominance, will this be the final death of those local cab companies who tie up with AutoCab?
Or could it be the lifesaver?
But don't forget that Uber were there at the beginning to destroy the local companies in the first place.
Reality Check on the Promised Path of Gold – The Bigger Picture
So what we then have here is the local company making Uber far more efficient by covering the work so that customer then continues to use Uber. Perfect business sense... for Uber and AutoCab – but not so sensible for the future survival of the local Taxi/PH system!
Uber will become so efficient with the local companies covering the work that it will be looking look like it is offering the supreme service despite being supported by the supply of cabs from the local companies... doing the work that they would arguably and probably have got in the first place without having to pay anything to Uber for the privilege!
Does this really make sense in the long run?
I'm absolutely sure that all the so called advantages for AutoCab customers will be thrown at them and it will look like a path of gold with a secure glittering future ahead. Despite AutoCab Director Hassan Abod publically panning the use of Uber only twelve months ago!
However I wonder if I could humbly suggest that those local AutoCab companies should look slightly further ahead because the way that I see it (and I have 38 years experience in the trade which has given me the gold badge of being a sceptic ) is that this is going to be suicide by stealth for them and Uber will eventually take over the whole country as the local companies fall as a result of the very simple and totally obvious reason being that Uber will have been supported by the local companies in making them more efficient and handing them total dominance in the local market.
One option is for all the AutoCab customers is to say “No! we're not going to do this we want to stay independent of Uber because we have built up our own business by our own strengths and we do not need Uber giving us a suicide pill and selling us back our own work!”
There are other dispatch systems available and to be honest with my previous experience in dealing with such cab technology most of the systems are pretty much the same nowadays. There are of course some systems that may have a great feature and a different system that has another great feature. But all-in-all they are pretty much the same. Probably the main differences are the running costs which is a consideration for a all different sizes of cab companies. However, in light of this latest announcement, perhaps the worst feature of the AutoCab system now is its alliance to Uber!
A simple example of helping the competitor – The Football Match
So we have Manchester United playing Liverpool in a very important nail biting match. But with Man U down 2-1 their star player gets injured. So it looks at its own reserves and thinks.. “Mmmm... we could do better here if we looked at the Liverpool reserves” and then under a pre-arranged agreement it is allowed to chose the best player from the Liverpool reserves. That player is now supporting the opposition and makes the team stronger and eventually Man U wins the cup.
Simplistic I know but a very basic example of how helping the competitor makes the competitor stronger.
There is one important point here which I don't know if Uber has considered (although more than likely has) because in some reports of the takeover it has been stated that Uber wants to do this to begin working in areas where it doesn't have an operator’s licence.
Areas such as Oxford and Exeter have been stated in the media as exactly that.
However I cannot see how this will work, let’s take a specific case such as in Oxford where Uber doesn't hold an operator’s licence.
Uber takes a job as an aggregator/broker and then passes (sells) it on to a local cab company in Oxford that uses the AutoCab system which will have an Oxford operator’s licence in place.
Would Uber be contravening the ‘Triple Lock ‘system? Or is it just the case that being an Aggregator/Broker like various other third-companies are that an Operator Licence is not needed?
Well perhaps it is time that such Aggregators/Brokers need to be properly licensed and be accountable as the ‘Principle’ in the booking process especially with the very poor record of protecting data under GDPR that Uber has demonstrated.
And just as a reminder of the Triple Lock system which means that when a booking is taken and dispatched there has to be three licences in place which is the ‘Operator licence’ the ‘Driver Licence’ and the ‘Vehicle Licence’ all from one licensing authority..
Amalgamation of Uber/AutoCab Software Systems
I strongly believe that somewhere down the line there will be plans .. if not already in motion... for an amalgamation of the Uber/AutoCab system software under such an exercise of 'Economy of Scale' and as such AutoCab users will be forced into changing their systems and way of working as under one Uber system
AutoCab Users Demand that Uber Relinquishes All Operator Licences
I have heard through the trade gossip telegraphs that some of the big AutoCab companies in Scotland who are attending a meeting next week (August 2020) that they will be demanding that Uber relinquishes all Operator Licences. Good strategic demand in my book. Although I think that is also a little worrying because for all intentions and purposes it looks like the Uber/AutoCab deal is being looked at as being favourable.
All of this might be complete and utter rubbish but I think is worth keeping in mind that ultimately Uber has had its grip around the throats of local companies since 2016 and has been slowly squeezing and increasing the pressure ever since.
It has encouraged the loss of ‘local licensing control’ by effectively inviting OOT’s to work out of area and created the infamous ‘Uber Mythical Regions’ effectively sticking its fingers up at local councils and in general, the UK Taxi licensing system.
So ultimately it will be down to all of those companies that use AutoCab and of course those drivers who have tried to fight off the predatory company that Uber has been.
But if they go along with it and give away their work to Uber to be sold back to them at least they can boast that they are now fully fledged ‘Uber Partners’!
As an Aggregator/Broker will Ube be able to relinquish its responsibility to provide Wheelchair Accessible Vehicles?
In Brighton & Hove there is an Operator condition of licence that any fleet or over 100 vehicles must be 20% WAV. The trade has always worked closely with the council and especially on disability matters and fully supported this condition to be in place a few years ago to keep the standard high in the city.
However this made it very difficult for Uber when it came here but it pledged at Licensing Panel meeting on the renewal application of it Operator Licence (declined) that it would ensure that this condition would be abided to.
What happened is that once the Brighton & Hove Uber fleet reached eighty then it had to start putting WAV’s in place and it stopped taking on saloon vehicles. But to get the WAV’s on it then had to start paying drivers to have these to the tune of £200 per week. A lot of these drivers then leased a WAV form an Uber-Partner lease company for £260 per week so effectively with the payment from Uber this was only costing the driver £60 per week.
So based on these figures if Uber was paying twenty drivers to have WAV’s this would be costing 4k a week or 208k a year!
I don’t know what the local conditions for Operators in other areas are maybe this is the same in some.
But if under the ‘Uber-Evolution’ role of just being an Aggregator/Broker then it will be able to give up any responsibility to provide WAV’s and this duty will be passed onto the local cab companies.
CAUTION – Campaign Against Unlawful Taxis In the Nation
This ‘CAUTION’ group has been very active in fighting against Uber being granted licences and was a contributor at the initial 2015 Uber Operator Licence application Licensing Panel Meeting in Brighton & Hove.
There were statements against Uber such as claiming
“Dishonesty” “False statements and declaration made by UBL” “Frustrating regulatory oversight with the use of Greyball and Ripley Software’ “Data Breach” “Rotten to the core”
There were many more claims against Uber from ‘CAUTION’ and all signed by David B Wilson Company Secretary and Licensing Consultant Campaign Against Unlawful Taxis In Our Nation Limited
Guess what though?
AutoCab CEO Safa Alkateb is listed as a Director of ‘CAUTION’
So it appears that we have the CEO of AutoCab who is still listed as a director of ‘CAUTION’ which made a great effort to stop Uber being licensed in the UK is now by virtue of the ‘Uber-Evolution’ expecting all the AutoCab users to become an ‘Uber Partner’!
The Big Question – Why Has Uber Done This?
Maybe Uber now realises that because of the years of resistance from the local cab companies in fighting to keep their independence that it can’t quite achieve the goal of destroying them so it is now using a form of issuing a deathly path of gold pill under stealth so they can all commit suicide instead.
Maybe Uber is extremely worried about losing its London TfL Operator Licence... or will be put under such strict conditions that one more sneeze and its out for good.
Maybe Uber thinks that it is going to lose the employment case? And if it does then maybe it wants to relinquish all involvement with drivers and let the local cab companies deal with it and act as an ‘Aggregator’ (broker) instead under a new role which I have named the ‘Uber Evolution’.
Maybe Uber thinks it is going to lose the VAT case where it has been stated that it could be made to pay back years of unpaid VAT to the tune of some £1.5B and also face future payments which would more than likely mean raising fares.
Maybe Uber is finally running out of steam although it still has an endless pot of other peoples money to throw at the brand to make it survive
I really do feel the dilemma that some AutoCab users must now be in especially those who have been under threat and had their work taken from them over the last few years by Uber. Additionally I also feel the dilemma of those AutoCab users who have never had to deal with Uber gnawing away at the air that they breath.
But in my humble opinion I would be extremely worried about this forced ‘Uber Partnership’ which means that it looks like all AutoCab users will have to roll over and take it up the you know what.
Uber will be charging 20% now... but what about the future?
Additionally what will the future charges be for the AutoCab system which is now owned by Uber?
Once you have agreed to the changes will you ever be in a position to get out later down the line when there are more changes which will no doubt be forced to comply with.
Many questions need to be asked but I am sure that the very experienced AutoCab users have plenty lined up for their meeting next week.
How about a new slogan for the Uber/AutoCab venture such as:
“We are going places... and we want to break you with us”
And just another reminder that Uber CEO Dara is pushing for the $1.50 ride. See here
If there is anything that is factually incorrect then please make contact with me to allow a correction to be made
Andrew Peters - Brighton & Hove Licensed Hackney Carriage Proprietor
Uber AutoCab Buyout/Takeover - August 6 2020
Since writing this editorial the stats have shown that to date (08/08/2020) the page has been accessed over 500 times from all over the UK.
If I am found at the bottom of Brighton Marina wearing concrete boots please use this editorial as a possible reason ; )
See the completely fictitious made up phone conversation between AutoCab and Speedy Cabs Here
Updated 09/08/2020 22:30
A completely ficticious phone conversation between AutoCab and and Speedy Cabs: Speedy Cabs
AutoCab: “Hi.. AutoCab here... How are you?”
Speedy Cabs: “Fine thanks.. what can I do for you?”
AutoCab: “Well you know that we have sold out to Uber”
Speedy Cabs: “Yes... I got the email suddenly out of the blue then started choking on my Rice Krispies.. the Mrs thought I was having a heart attack”
AutoCab: “Well we are looking for feedback”
Speedy Cabs: “Well I wasted a whole bowl of Rice Krispies and the Mrs kept beating on my chest”.
AutoCab: “Sorry to hear that but I meant feedback on the Uber buyout of AutoCab”
Speedy Cabs: “Isn’t that a bit late now the deal it done?”
AutoCab: “Well we had to keep it quiet as we didn’t want anyone to know about it”
Speedy Cabs: “Yep you certainly achieved that!”
AutoCab: “I know.. we are very good at what we do... but what do you think?”
Speedy Cabs: “Well having only just really recovered from the shock let me give you my first thoughts”
AutoCab: “Ok great fire away”
Speedy Cabs: “Mmmm .. Don’t tempt me....” “Well for a start we have been with you for a number of years and have had a pretty good relationship....”
AutoCab: “Good start!”
Speedy Cabs: “Mmmm... and we have effectively contributed to the success of AutoCab with advising on features and development over the years which has been great to allow us to build a good reputation as a local cab supplier to our town”
AutoCab: “Loving it so far....”
Speedy Cabs: “ Mmmm.... and we have paid AutoCab a lot of money over the years to build ourselves up to be the best we can for the public and the drivers...”
AutoCab: “Loving it even more!”
Speedy Cabs: “ So why do you think that after all this time of being in the business where I have worked many hard hours to build up my own brand and customer loyalty do you think that I am now going to happy ending working for X^%$$! Uber by default of having paid your company to be the company that it is... along with all of the Speedy Cabs:s up and down the country?”
AutoCab: “Well.. we think it is a great way forward...”
Speedy Cabs: “Have you cashed the cheque yet?”
Speedy Cabs: “We believe that by letting Uber use our software to connect...”
Speedy Cabs: “Have you cashed the cheque yet?”
AutoCab: “We believe that the future is tomorrow..”
Speedy Cabs: “I see you have been well versed in Uber-Speak... Have you cashed the cheque yet”
AutoCab: “We are looking at exciting times ahead connecting people who cannot get an Uber now in your area because Uber have not moved in there.”
Speedy Cabs: “Ok so you are not going to answer my question.... but have you recently bought yourself a really nice and very expensive car?”
AutoCab: “With you local cab company you can now be a supplier of cabs to Uber”
Speedy Cabs: “Ok forget my question. But why would I want to be a supplier of cabs to Uber where they are currently not offering their app to the public here”
AutoCab: “Thousands of people a day are deprived of using an Uber because there are areas that Uber has not ventured into. In fact Uber has not taken on any more areas since 2016...”
Speedy Cabs: “Hold on there! So where Uber has not bothered to get a licence it thinks that thousands of people are being deprived of its service? So what do you think they do instead then... walk?
AutoCab: “Well those thousands of people would...”
Speedy Cabs: “Yes go on... “
AutoCab: “Use a local cab..”
Speedy Cabs: “Exactly so why the X^%$$! do you think that I want to be a supplier of cabs to Uber in my areas where we have a few cab companies already competing together. Do you think this is going to make my company better!
AutoCab: “Well yes because we can then make the Uber app available in your area and then people will use it to get an Uber and we will pass the work onto you”
Speedy Cabs: “For free?”
AutoCab: “Well no.. of course not.. it is a service that AutoCab and Uber are offering to you!
Speedy Cabs: “How much will this cost me”
AutoCab: “Only 20% of the fare..”
Speedy Cabs: “20%?”
Speedy Cabs: “20%.. for now.. what about the future”
AutoCab: “That’s the great thing.. the future is definitely tomorrow and we want to break you... ooops.. sorry.. we want to take you with us!”
Speedy Cabs: “But my drivers are on 12.% of the fare at the moment”
AutoCab: Silence...... “Sorry you’re breaking up.....”
Speedy Cabs: “How come AutoCab Director Hassan Abod was featured in the August edition of Private Hire & Taxi Monthly giving five reasons not to use Uber? Under 1. LESS SUPPORT FOR YOUR LOCAL ECONOMY - 2. YOU CAN’T USE IT EVERYWHERE - 3. UBER CAN’T DEAL WITH TRIP COMPLEXITY - 4. INCENTIVES DON’T LAST LONG - 5. LOCAL TAXIS ARE BUILDING FOR THE FUTURE”
AutoCab: “Oh... that is yesterdays news.. fish and chip paper now!”
Speedy Cabs: “Mmmmmm... not quite.. too shiny and smooth for fish and chips” And what about AutoCab CEO Safa Alkateb is listed as a Director of ‘CAUTION’ (Campaign Againt Ublawful Taxis In Our Nation) that was backing that Uber should never be issued with an Operator Licence?”
AutoCab: “Oh well.... that was then... but the then the future will be tomorrow!
Speedy Cabs: “Mmmmmm.... more Uber –Speak . But getting back to basics those customers who now have the Uber app available to them were my customers anyway!!
AutoCab: “Haaa.. but you don’t see the advantage... Uber is trendy and a big brand name so everyone will now start using the Uber app in your area and you will get all the work”
Speedy Cabs: “But I have a good majority of the work already and AutoCab and Uber now want to sell it back to me! I already have the AutoCab app for my cab company advertised everywhere so are you now saying that the AutoCab app is inferior?”
AutoCab: “Well no.. it’s very good,, but we are looking at opening up new paths of opportunity to all Speedy Cabs:s and..... we will be offering the choice of an ‘Uber’ on the app or a ‘Local Cab Company.”
Speedy Cabs: “And if there is no actual Uber on the app because you couldn’t be arsed to get a licence here what happens then?”
AutoCab: “Well this is the great thing! You get the job!
Speedy Cabs: “You mean the job I would have got anyway without all this amalgamation on Uber and AutoCab”
AutoCab: “Errrr... yes”
Speedy Cabs: “Ok so what if ‘Jon’s Cabs’ down the road changes to AutoCab?”
AutoCab: “Well that would be great as it means we will all be working together!”
Speedy Cabs: “You mean we will all be working under Uber or more likely end up working for Uber and my competitor ‘Jon’s Cabs’ will also be getting this supposed work from Uber!”
AutoCab: “Errrr.. Yep!”
Speedy Cabs: “What will happen in areas where Uber has already been at the throat of the local cabs and where it has brought in hundreds of vehicles not licensed in those areas eroding local licensing control?”
AutoCab: “Well that’s the whole dynamics of the network! They will all be making Uber super strong and super efficient!”
Speedy Cabs: “ You mean to placate the investors who have piled billions into Uber that again has made a huge financial this Second Quarter?”
AutoCab: “I am sorry you will have to ask Uber that... when you become and Uber-Partner!
Speedy Cabs: “LISTEN!....I have spent years as a loyal customer with AutoCab and have had a good relationship. I have built up my business with the competitors that I already have. I know my market here and I provide a damn good service with damn good drivers. You now want me to be part of the Uber brand as an ‘Uber-Partner’ by default. You want me to be a supplier of my cabs to help Uber get known in my area and to help make Uber stronger and more efficient. You want to sell me back my work that I already have because once Uber makes its app available here then it is expected that the trendy hipster are so Uberised that they will use the Uber app instead of my own companies app supplied by you AutoCab!
AutoCab: “Yes! By Jove he’s got it!
Speedy Cabs: “Yes I certainly have... now X^%$$! Off!