Vehicle-for-Hire: The Continuing Saga

We’re at it again: Vehicle-for-hire, most commonly thought of as Uber versus taxis, has returned to City Council in the form of new proposed bylaw amendments. As usual, nobody on either side of the Uber/Taxi debate is happy with the proposal. Such is life in the vehicle-for-hire world, apparently.

We’ve heard extensively from both sides on this issue, and it’s become clear in this that there is absolutely no solution that makes everyone happy - unfortunately, that’s the nature of compromise. What’s important now is that we move it along. We had hearings, we’ve consulted, we’ve met, we’ve done it all. Now Council needs to act and make a decision on this issue.

My decision? Despite the repeated chorus from the taxi industry that Uber will rob them of their livelihoods, I do believe that there is potential for both services to coexist prosperously and to jointly meet the needs of the public with excellent customer service. Yes, there will be compromise, and parts of both business models will need to adapt in order to succeed in the market. But this adaptation and competition will ultimately make the market better.

An important part of the vehicle-for-hire bylaw is the provision for accessible cabs. Part of the fee paid by the Transportation Network Companies will go to supporting a fund for the conversion of cabs into accessible taxis. This clearly is asking one business to subsidize its competition, but that’s the way it’s should be right now. Uber isn’t paying GST, and has accepted similar provisions in other jurisdictions (Seattle for example).

The accessible taxi fund could help to support those last ~30 taxi drivers who invested in some cases over $200,000 into buying their plate in recent years. These drivers made a big up-front investment, and the support to convert to an accessible taxi will help them to recoup that investment, even if the market conditions for taxis do change in the way that cab companies have been predicting.

The Seattle model that I mentioned early is an interesting point in the Edmonton discussion. There, in order to avoid a 150 car cap on their operations, Uber accepted a $500/car yearly fee (compared to $920 every two years in Edmonton) for the dispatcher, and a $50 license fee per year ($60 in Edmonton) for drivers. This is in addition to much stricter regulations around driver training, which our bylaw doesn’t touch on, and the $0.10 fee per fare to contribute to the accessible taxi fund. Those regulations are much more onerous than the ones proposed in Edmonton, and Uber continues to operate in Seattle.

The bottom line is that I don’t believe Uber has to pull out of the market if it’s regulated, and I don’t believe that cabs will become obsolete if Uber officially enters the market here. I appreciate that both groups are trying to obtain a good negotiating position, but I think it’s time to ditch the hyperbole and get down to business: providing excellent and efficient service to the citizens of Edmonton.