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Uber, lyft and other taxis

Why Tensions Between Uber and Cities Peaked in NYC: QuickTake

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New York City dealt Uber Technologies Inc. a blow recently by halting new licenses and blocking the company from adding drivers in its largest U.S. market. It marked a turning point in the city’s relationship with digital ride-hailing services, which have flooded streets, compounded traffic and pushed taxi owners to a financial cliff. New York’s actions are the latest example of how city and national governments worldwide are trying to corral Uber after years of rules-be-damned growth under former managers. They also show how new Chief Executive Dara Khosrowshahi has tried to balance innovation with political diplomacy.

1. What did NYC do?
New York’s City Council in August passed legislation to freeze new ride-hailing licenses for a year while a task force figures out if more needs to be done to protect drivers and passengers. Wheelchair-accessible vehicles are exempt from the cap. The city’s Taxi & Limousine Commission can also set minimum pay standards for drivers of ride-hailing services. Requiring companies to make up the difference between that pay floor and a driver’s hourly earnings is intended to be an incentive for companies to keep the number of drivers down and balance the supply of ride services with demand.

2. What have other governments done?
Uber came close to being banned in London when regulators in 2017 didn’t renew Uber’s operating license, citing safety and governance shortcomings, such as failing to do proper background checks on drivers. Uber eventually won a 15-month probationary license in June after convincing a judge it had reset its management and culture. The European Union’s highest court also took action against Uber when it ruled in December that Uber is a transport company rather than a digital service provider, making it subject to each member nation’s own rules. Japan, Argentina and Germany have also made it difficult for the company to operate its ride-hailing business in those countries. In the U.S., Seattle passed a first-of-its-kind ordinance in 2015 allowing drivers-for-hire to collectively bargain, although that may now be in jeopardy: A U.S. appeals court in May let proceed an antitrust challenge brought by the U.S. Chamber of Commerce.

3. Why are they cracking down on Uber?
Consumers have embraced ride-hailing services such as Uber and Lyft Inc., leading to an explosion in drivers and vehicles that’s been tough on local governments. The sector has a history of trying to maneuver around regulations and entrenched taxi industries, making it ripe for a crackdown. In New York, app-based for-hire vehicles jumped to more than 80,000 from about 12,600 in January, 2015. The oversupply resulted in some 40 percent of cars traversing the city without passengers. The economic cost from traffic-choked midtown Manhattan streets has been calculated in the billions of dollars while competition has suppressed average pay to about $17 an hour. Six drivers committed suicide within seven months, citing their economic desperation and creating a public outcry that spurred the city council to act.

4. Is Uber as bad as some city officials say?
Uber and other app-based ride companies have won loyal users by offering inexpensive and convenient transportation, especially for people in areas ill-served by mass transit. The services represent a flexible gig for drivers. At the same time, Uber’s size and the allegations of misconduct against it have drawn plenty of scrutiny. Uber offices from Montreal to Hong Kong have been raided by authorities investigating various suspected wrongdoings by the company, employees, or both. It has also come under scrutiny by the U.S. Justice Department for possible violations of anti-bribery laws. Critics have pointed to these alleged misdeeds as evidence of a renegade corporate culture under co-founder and its former chief executive officer, Travis Kalanick, who was ousted amid allegations of discrimination and questionable business practices at the company.

5. Wasn’t Uber’s new CEO supposed to allay those fears?
Yes. After London officials moved to oust the company, he issued a contrite public apology that acknowledged the company had “got things wrong along the way.” Soon after, the company voluntarily suspended its UberPop service in Oslo, avoiding a conflict while the Norwegian government wrote new rules for app-based ride services. A London judge’s decision to grant the company a 15-month license rewarded the contrite approach taken by Khosrowshahi, who flew in for talks with the city’s transport officials just weeks after assuming the CEO role. He followed a similar playbook in New York by huddling with politicians over concerns about congestion and driver suicides, and even supporting a fee on ride-hail trips to help city cab drivers in dire financial straits.

6. How have Uber and other ride-apps affected traditional cabs?
Taxi drivers from South Africa to Canada have staged mass protests of ride-hailing services, Uber in particular. In New York, Uber first affected traditional cab drivers. But as the company grew, all for-hire drivers including limousine services, liveries and Uber drivers themselves saw business decline. New York’s Yellow Cab industry has been capped since former Mayor Fiorello LaGuardia in 1937 created a limited number of medallions when taxi supply increased faster than passenger demand. That strategy survived for 50 years, during which medallions became worth hundreds of thousands of dollars until Uber, Lyft and Via cars created new competition and drove taxi services into a financial crisis. Now, there are so many for-hire cars competing for passengers, few drivers in any part of the industry say they can make a living.

7. Are government actions hurting Uber’s bottom line?
Government regulation has long been a powerful constraint on Uber’s revenue growth, which has already started to slow. Across the world, Uber operates in a highly regulated industry and governments have the power to shut it down altogether, raise taxes, or restrict its footprint. A renewed push to limit Uber’s size in cities would further hinder the company’s revenue growth. For now, it’s hard to tell if the regulatory backlash in New York is anomalous or if it could trigger regulatory contagion globally. Expanding in existing markets is essential to maintaining growth ahead of a public offering next year. The regulatory backlash in New York City was particularly worrying for the company because the city has long been one of Uber’s most profitable markets.

8. What about an Uber IPO?
Increased regulation could hamper Uber’s financial performance, but it’s unlikely to derail Uber’s plans for a public offering in the second half of 2019. The company faces intense investor pressure to deliver on a public offering. Some shareholders would be freed up to sell their shares if Uber doesn’t go public on schedule. Whether Uber can recruit a chief financial officer and the state of the public markets will likely play a bigger role in the company’s IPO timing than government restrictions.

Source: https://www.bloomberg.com/news/articles/2018-08-20/why-tensions-between-uber-and-cities-peaked-in-nyc-quicktake

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Uber, lyft and other taxis

Lyft Is Another Step Closer to Driverless Ridesharing

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Ridesharing company Lyft (NASDAQ: LYFT) inched a little bit closer toward self-driving ridesharing last week when it said in a blog post that it’s adding Chrysler Pacifica hybrids to its autonomous vehicle (AV) testing fleet and opening a new self-driving vehicle test facility.

The new facility, located in East Palo Alto, California, will allow the company to increase the number of AV tests it can run. It will also let the company test how the systems do with different road configurations, including intersections, merging lanes, traffic lights, and similar challenges. The company said in the post that the new facility will let Lyft “further accelerate the speed of innovation.”

Lyft says that it’s driving four times more autonomous miles per quarter than it was just six months ago and has about 400 employees worldwide working on self-driving tech. That figure is likely to expand, considering that Lyft has more than 40 autonomous vehicle job openings listed on its website.

In addition to the new facility, Lyft said that it’s adding Pacifica minivans to its AV fleet, which is the same vehicle that Waymo, Alphabet’s self-driving car company, uses for its public self-driving ridesharing project and AV tests. Lyft said that, “The minivan’s size and functionality provide our team with significant flexibility to experiment with the self-driving rideshare experience.”

Why does all this matter for Lyft’s autonomous-vehicle future? Because to have a successful, public self-driving ridesharing fleet in the coming years, Lyft needs to lay the groundwork right now.

Isn’t Lyft already doing AV testing?

Lyft is, of course, already working on AV testing. The company’s original self-driving test facility has been up and running since early 2018. The company also started a partnership with Waymo earlier this year to test autonomous ridesharing. Additionally, Lyft also works with Aptiv, an AV tech company, and together they’ve created “the largest publicly available commercial self-driving program in the country” and have completed more than 75,000 rides through the partnership.

But the recent announcements by Lyft show that the company is taking its AV focus a bit further. The Pacifica minivans have been used by Waymo’s AV ridesharing program in Phoenix for more than a year now, making them a proven choice for shuttling around ride-hailing passengers. Lyft may not be ready to launch a wide-scale autonomous ridesharing service just yet, but testing out these vehicles likely means that it’s moving past earlier stages of AV testing and is now looking at how its next-generation self-driving tech can handle new vehicles.

Why this matters for Lyft

Lyft and other ride-hailing companies, including Uber, are keeping a close eye on self-driving developments and testing out the technologies themselves because it could eventually become an integral part of their business model. Research from Intel predicts that the AV ridesharing market could be worth $3.7 trillion by 2050.

Additionally, as regulations surrounding ridesharing drivers continue to increase, Lyft is likely looking to AVs to eventually replace some human drivers. Just a few months ago, the state of California introduced a bill that could pave the way for independent contractors, including Lyft’s drivers, to be reclassified as employees. If a version of the bill becomes law and other states follow California’s lead, it could significantly increase operating costs for Lyft. That could be bad news for the company, which is unprofitable right now and hoping to be in the black just two years from now.

While Lyft’s announcements may not seem all that significant right now, investors should know that these baby steps moving the company closer to AV ridesharing could have huge results in the coming years. For now, investors should be pleased that Lyft is beefing up its own AV testing. Each move the company makes now means that it’ll be much more ready for a self-driving ridesharing future.

Source www.nasdaq.com

By Chris Neiger

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Uber, lyft and other taxis

Uber fined $650 million by New Jersey over driver classification

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New Jersey is the latest state to say Uber’s drivers should be classified as employees rather than independent contractors. The state’s Department of Labor and Workforce Development said that because of this misclassification, the ride-hailing company owes it roughly $650 million in unemployment taxes and disability insurance, according to Bloomberg Law.

The Department of Labor reportedly has been trying to get unpaid employment taxes from Uber going back as far as 2015, according to documents obtained by Bloomberg Law. It said the company owed the state $523 million in overdue taxes along with another $119 million in interest and penalties for the last four years. Uber disputes these findings.

“We are challenging this preliminary but incorrect determination,” an Uber spokesman said in an email. “Because drivers are independent contractors in New Jersey and elsewhere.”

Driver classification is an issue that government regulators have been taking a closer look at over the past year. California passed a law in September that could require Uber and other on-demand companies to reclassify their drivers as employees instead of independent contractors. The law is set to go into effect Jan. 1. New York, Oregon and Washington state have considered similar legislation.

Uber, Lyft and several other tech companies have vowed to fight the California law, collectively putting more than $90 million behind a ballot initiative that’ll take the issue to voters next November. Many drivers have said this move is a slap in the face as they struggle to earn a living wage.

Uber’s and Lyft’s business models depend on bringing aboard hundreds of thousands of independent contractors, whose labor is typically cheaper than that of employees. That’s because Uber and Lyft drivers supply and maintain their own cars and also pay for their own health care and benefits, such as sick days or overtime pay.New Jersey is the latest state to say Uber’s drivers should be classified as employees rather than independent contractors. The state’s Department of Labor and Workforce Development said that because of this misclassification, the ride-hailing company owes it roughly $650 million in unemployment taxes and disability insurance, according to Bloomberg Law.

The Department of Labor reportedly has been trying to get unpaid employment taxes from Uber going back as far as 2015, according to documents obtained by Bloomberg Law. It said the company owed the state $523 million in overdue taxes along with another $119 million in interest and penalties for the last four years. Uber disputes these findings.

“We are challenging this preliminary but incorrect determination,” an Uber spokesman said in an email. “Because drivers are independent contractors in New Jersey and elsewhere.”

Driver classification is an issue that government regulators have been taking a closer look at over the past year. California passed a law in September that could require Uber and other on-demand companies to reclassify their drivers as employees instead of independent contractors. The law is set to go into effect Jan. 1. New York, Oregon and Washington state have considered similar legislation.

Uber, Lyft and several other tech companies have vowed to fight the California law, collectively putting more than $90 million behind a ballot initiative that’ll take the issue to voters next November. Many drivers have said this move is a slap in the face as they struggle to earn a living wage.

Uber’s and Lyft’s business models depend on bringing aboard hundreds of thousands of independent contractors, whose labor is typically cheaper than that of employees. That’s because Uber and Lyft drivers supply and maintain their own cars and also pay for their own health care and benefits, such as sick days or overtime pay.

 

“New Jersey is sending a message that the state’s labor laws aren’t dictated by corporations,” Bhairavi Desai, executive director of the New York Taxi Workers Alliance, said in a statement. “It’s a stinging rebuke of the architects of the gig economy, and we hope it permeates across other sectors.”

Even if Uber’s drivers were determined to be employees rather than independent contractors, Uber said the $650 million New Jersey tax fine would be too high — particularly if it’s based on what the company has earned in the state. Uber didn’t disclose the revenue it generated in New Jersey over the past four years, but its combined revenue for all the markets where it operated in 2018 was $11.3 billion.

 

 

 

Source www.cnet.com

By Dara Kerr

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Uber, lyft and other taxis

Adams Clinical removes hurdle to clinical trial participation

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How Adams Clinical increased retention and streamlined operations by switching to Uber.

One of the hardest parts of conducting a clinical trial is identifying willing participants. Once a participant is identified, strict qualifications and an often-lengthy time commitment limits who can participate, and a lack of access to transportation can make it difficult for participants to commit to and complete the study. To help improve recruitment and retention rates, Adams Clinical offered taxi rides to their participants. However, this solution became a burden on operational efficiency since taxis were only accessible to participants who lived close by and required the staff to pay at the end of each ride.

Finding the perfect transportation solution with Uber Health

To expand their transportation offering, Adams Clinical became an early beta partner with Uber in 2016. The team started using Uber’s web dashboard to arrange and pay for rides for participants with just a few clicks. Over the three years of this partnership, the switch to Uber Health simplified operational management, while reducing time spent on recruitment with increased retention rates. The easy-to-use Uber Health dashboard tracked all the rides and processed payments from one centralized interface, allowing the staff to arrange rides without the hassle of paying at the end of each trip. This flexibility, plus the extensive reach of Uber driver-partners in the Boston area, provided Adams Clinical with the transportation solution needed to successfully manage their participants in need of rides—which removed the headache from recruiting and retaining their study participants.

The result: Improved retention rates, simplified financial records, and an overall lift in team morale

By teaming with Uber Health, Adams Clinical enjoys a number of key benefits including:

• Expanded Recruitment—Using Uber Health cut down the length of enrollment by providing a larger pool to recruit from, resulting in a 5 to 10 percent reduction in recruitment time over the last two years. 

• Centralized Billing—All rides are charged to one company credit card, which is then processed at the end of each month to streamline the amount of administrative effort required.

• Reliable Service—Each ride is tracked in the dashboard so the team knows when the participant will be arriving to help keep the rest of the study on schedule.

• Improved Retention—In the first two years of the partnership with Uber, Adams Clinical estimated up to 20 percent fewer people dropped out of a trial when transportation was arranged to and from the clinic.

• Financial Accountability—Details for each ride are available in the dashboard, and can be downloaded to a spreadsheet, offering convenient management with trial-specific reporting per participant.

• Easy to Use—Using Uber Health has been easy for both staff and participants, even among populations without smartphones or passengers new to Uber.

 

by Kendall Brown

Source uber.com

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