Truck & Fleet ME explores the case for Uber in the GCC
Visitors to the Dubai will admit the emirate’s most remarkable feature is the enhanced technological quotient of its transport networks. While the traffic encountered on the city’s roads is undeniably a peeve for both , residents and tourists, Dubai’s multitude array of well-established transit options, such as the metro, buses, taxis, water taxis and, soon, a tram, is perhaps light years ahead of most others in the region. Where, in this already crowded network, does Uber fit in?
It is unlikely you haven’t heard of Uber before. The five-year- old phone application, launched by its namesake firm in California, USA, has taken the world by storm with the unprecedented ease of taxi hiring services it providesmakes for. Catering throughWith both, luxury and affordable car fleets, Uber cures a pain point for the many GCC riders queuing up in the sun for an elusive taxi ride.
‘UberBLACK’ is the first of two services Uber offers in the UAE, and is supposedly named after the ‘Black Cars’ service system in New York City. ‘UberX’, launched in 2012, is the more affordable and less luxurious second option Uber is providing in the country.
JP Mondalek, general manager for Uber’s UAE operations, says extensive research preceded the arrival of Uber into the UAE and its expansion across the rest of the Middle East.
“Before launching any city, we spend plenty of time there to understand the infrastructure and how we can best fit within the city’s transportation ecosystem. We are currently present in Dubai, Abu Dhabi, Jeddah, Riyadh, Doha and Beirut, with plans to expand across the region,” Mondalek he tells tells Truck & Fleet ME.
“The response across the Middle East has been great and we are consistently growing, matching supply with demand and lowering our estimated time of arrival – the time from when the rider makes the request to when the driver shows up at their door. In the UAE, it is under five minutes.”
Quite possibly, it is this unconventional swiftness that has led taxi associations from across the world to revolt against Uber. While consumers, due to substantial time and cost reductions through Uber rides, have had little to complain about so far, taxi drivers and associations from parts of Europe, America and even India have driven resistance against to the app.
Taxi drivers and unions from Germany, Spain and the UK have protested against the use of Uber between May and September 2014 alone. London’s ‘black cab’ drivers launched a mass protest against the app in June 2014.
Early September saw Uber slapped by have a ban slapped on ita ban in Germany; the ban , which was overturned later during in the month, but further clarification regarding the legality of the app in the country was not provided.
Furthermore, a change in national economic policy has raised concerns over Uber’s operations in India, where the country’s Reserve Bank is now working to enable an online payment model which goes against Uber’s existing one.
These notions events suggest Uber is a heading towards becoming a monopolistic transport provider in its operating markets. However, Mondalek refers to his employer as a “technology” firm to explain the ride hiring setup followed by the app.
“As a technology company, we don’t own cars or employ drivers. Instead, we partner with existing, licensed transportation providers who use our platform to grow their business,” Mondalek claims.
But operator resistance is far from being the only battle Uber is fighting. In September this year, the California chapter of the National Federation of the Blind filed a lawsuit on against the company after it was found blind Uber customers were “refused a ride once the driver saw them with a service dog,” as per a report by The Washington Post, which also stated that a service dog was placed in the trunk of an Uber cab without prior communication about the same with the blind customer.
Elsewhere in Atlanta, a group of local taxi drivers filed a case against 13 Uber drivers for non-payment of a weekly $160 fees to the city. 11Alive reported that Uber, according to the drivers’ officially-filed complaint, “illegally operates as a taxicab business as it advertises and solicits business for its drivers, dispatches the calls and charges customers via credit cards based on measured time and calculations of mileage through the use of GPS and smartphones.”.
Nonetheless, Mondalek insists Uber’s operations in the UAE are fully legitimate and comply with national policies.
“We have not come across any challenges nor expect there to be many as we grow throughout the region.,” he says.
“In the UAE, we are complaint with all local structures in place, and therefore we have had no problems whatsoever.”
Uber, Mondalek assures, has grand plans for expansion in the GCC, where governments are currently working to build a unified rail network and construct or upgrade their local metro networks.
With the endeavour plagued by delays in countries like Kuwait and Bahrain, it is natural to question whether the region is ready to travel via its smartphones.
“If there is transport, then there is infrastructure (already in place),” Mondalek responds, when asked whether GCC member states have the capacities required to allow Uber to perform to full potential.
“The technological innovation that is embedded in the Uber experience is about bringing a better service, better safety for passengers and complete and unrivalled price transparency using the current licensed supply in the market.”
Mondalek’s confidence is inspiring for a product currently famous for its functionality, yet also infamous for the severe criticism it is attracting from veteran service providers in global markets.
He refuses to draw comparisons between Uber’s results in global markets, but admits that his product’s road to complete market adoption is bound to face hurdles from traditional market players.
“I am not in a place where I can comment on other markets in Europe, for example,” Mondalek says.
“But Uber is challenging outdated structures that have been in place for a very long time. With that kind of change, there is always going to be some sort of resistance,” Uber’s head of the UAE concludes.