Uber’s Chief Executive Officer (CEO), Dara Khosrowshahi, met with Japanese prime minister Shinzo Abe in Tokyo on 21 February 2018. In the meeting, Khosrowshahi reportedly has said that Uber will work in partnership with Japanese taxi companies and not confront them.
A country without ridehailing
Over the past few years, Uber’s presence in Japan has been unimpressive, to say the least. Its global ridehail model, where amateur drivers use their private cars to carry passengers, has met with firm opposition from stakeholders in the taxi industry. The company’s ridehail pilot project in Fukuoka was quickly blocked by the Ministry of Land, Infrastructure and Transport as an illegal taxi service in 2015.
Japan remains the only country in the world without a ridehailing service by Uber or any other international operator.
The media, therefore, saw the commitment that Khosrowshahi made to Abe as a major turning point in Uber’s business strategy in Japan.
Since then, whilst it took some months for Uber to launch such a working relationship in Japan, and whilst the number of taxi firms that have opened their doors to Uber is still limited, you can now book a taxi with the Uber app in cities including Nagoya, Osaka, Kyoto and Hiroshima. Chinese company Didi Chuxing is the major competitor in this race. Last year, it established Didi Mobility Japan with SoftBank as an operator to work in partnership with Japanese taxi firms. It now has a presence in eight Japanese cities including Tokyo.
A new company?
Unlike the former CEO of Uber, Travis Kalanick, who was reckless and belligerent, Khosrowshahi has often presented himself as a reconciling and cooperative figure towards regulators. For example, when Transport for London (TfL) revoked Uber’s operating license in the capital, stating that “the company is not fit and proper” (under the previous leadership of Kalanick), Khosrowshahi publicly apologised, admitting that Uber made mistakes in the past. His tactic paid off as the UK courts eventually accepted Uber’s appeal against the TfL and granted Uber a probationary license of 15 months in June 2018.
Likewise, Uber’s Emilie Potvin, head of strategy and planning for Asia-Pacific, said in the South China Morning Post on 4 November 2018: “We apologise for the mistakes we made in the past”, “And we want to look at that together in partnerships with those governments and that’s very important to us”. A similar statement was made by an Uber official in Spain on the previous week to this interview.
So, has Uber really changed?
No, not quite so.
Old habits die hard
Around the same time that Khosrowshahi made his public apology in London he was seen in Brasilia and San Paulo, lobbying the Brazilian parliament. His mission was to water-down a bill that, if passed in its original context, would significantly restrict their business in Brazil. He flexed his muscles and was successful.
Last year, Uber and its US rival Lyft spent thousands of dollars in New York City to stop its City Council from enacting a set of new legislation that will cap the ridehail vehicles, set minimum wage for those drivers and establish a common minimum fare for yellow-cabs, for-hired vehicles and ridehailing services. This time, they failed.
In a stark contrast to Potvin’s appeal for reconciliation in Hong Kong, a media report in January 2019 stated that, “through undercover operations over the past few months (by the Motor Transport Workers General Union and the Taxi Drivers & Operators Association), they had uncovered about 800 cases of Uber drivers illegally plying their trade, and reported 100 of them to police”. <Taxi drivers plan anti-Uber march in Hong Kong, threatening citywide protest if demands are not met>
A Reuter’s article on 7 May 2019 titled As IPO looms, Uber clings to hard-knuckled tactics in pursuit of growth stated that Uber “is still testing the rule of law” in countries such as Chile, Mexico and South Africa, with a quote by a former Uber manager stating that “It’s in the DNA, old habits die hard.”
Do we trust Uber?
In Nagoya, Fuji Taxi Group is Uber’s partner with 300 vehicles. In May, they launched a three-month pilot project called “Value Taxis”. 30 taxis from Fuji are now registered as tourism vehicles that will shuttle passengers to and from three popular districts in Nagoya around the clock. Fares are fixed and 18.6% cheaper than taxis.
Whether Uber is setting their Value Taxi service to marginalise the incumbent taxi operators in Nagoya, or if this is a mere publicity stunt to promote their app-based service, remains to be seen. Nevertheless, it reaffirms the fact that Uber lies and it cannot be trusted. Whatever happened to that promise that the CEO made to the premier of a state?
It is in their DNA. Uber hates regulations. If at all possible, they will choose to be a PHV operator than to follow the taxi rules. Better still, register their services as rent-a-car business or in tourism.
In its S-1 form that Uber released to investors for its IPO, it hides no secret that it wants to “enter or expand operations” in “Argentina, Germany, Italy, Japan, South Korea, and Spain”.
Let us continue to keep a close eye on this Trojan horse. After all, DNAs are hard to change.
ITF (International Transport Workers’ Federation) automation/future of work coordinator