To Uber or Not to Uber? That is Airports’ Question
1 Jul, 2015By: Tracey Schelmetic
National and International Airports Grapple With Ride Networking Service
Uber has been on a wild ride that has made its investors happy, but the transportation network company headquartered in San Francisco has ruffled a lot of feathers. Uber was founded in 2009, and since then, the service has become available in 58 countries and 300 cities worldwide.
Uber drivers, who are independent contractors (mostly…more on that later), must have a valid driver’s license, a fairly new car, a clean driving record and an iPhone to use the Uber app. From there, they become available (when they wish) to pick up and drop off users of the app. No cash is exchanged in the car (it’s all done through the Uber app), and drivers pay Uber 20 percent of the cost of the ride. Since its successful launch, new Uber services have been launched, such as UberX, which uses more economical cars and features lower rates, or UberTaxi, which makes partnerships with local taxi commissions.
It’s a model that’s appealing to many passengers – commercial taxis aren’t always available, particularly during late and early hours at airports—and many Uber drivers who are looking for a flexible way to be their own boss. Those who aren’t thrilled about Uber include some traditional tax services, drivers and unions; some safety advocates, consumer privacy advocates and even the National Federation of the Blind, which has sued the company claiming (as have other handicapped users) claiming a pattern of denial to service to blind riders. More recently, however, it’s airports that are grappling with whether to Uber or not to Uber.
Some airports openly welcome Uber: San Francisco International Airport, on Uber’s home turf, is one of them. Others are uncomfortable with the idea of freelancers operating in a business that is strongly regulated and licensed for traditional taxi drivers. According to Michael B. Baker writing for Business Travel News, the divergent approach to Uber at different airports was a point of discussion at the recent CAPA Americas Aviation Summit held in Las Vegas in April. One of the speakers, Greater Orlando Aviation Authority executive director Phillip Brown, outlined why Uber is verboten at his airport.
“To operate on the airport, you have to have a city permit,” Brown told attendees. “[Uber] doesn’t want to have any regulation or pay the permits, so we won’t allow them in any regulatory scheme.”
While there are some airports that welcome Uber services to fill in the gaps when other commercial services are unavailable – Pittsburgh International Airport is currently negotiating with Uber to determine how to manage pickups – most major airports are approaching the service cautiously in order to ensure that Uber drivers aren’t gaining an unfair advantage over regulated and licensed ride services. (Baker provides a rundown of the degree to which Uber is allowed to operate at the nation’s major airports in his article.)
However, Uber, is in for a new breed of competition. Successful Meetings reported that New York City’s LaGuardia Airport has become the latest transportation hub to launch the taxi-sharing service, Bandwagon. Already a popular option in a number of places serving the meetings, group and sports event planning trade, such as the Las Vegas Convention Center, the Boston Convention & Exhibition Center, Newark International Airport United Terminal C, and New York City Cruise Terminals, Brooklyn-based Bandwagon allows passengers waiting in standard taxi queues to find a travel companion using an onsite iPad kiosk. For a small fee, the service pairs travelers who are going in the same direction; upon being matched, those passengers can jump to a taxi-share priority line and save 40 percent on their fare.
The service is envisioned as way to help taxis compete with ridesharing services like Uber and Lyft. Although cab drivers are paid the metered rate, passengers pay a reduced fee by consolidating their ride and fare with a companion.
“Partnering in this program will help increase taxi availability for our customers," said LaGuardia Airport General Manager Lysa Scully. "Additionally, the Port Authority is committed to reducing its carbon footprint and this is an eco-friendly transportation option in line with our sustainability goals."
Abroad, the situation is more complex. In some countries, Uber has been forbidden to operate at all – South Korea and Thailand have both laid a blanket on Uber services – and in others, only Uber Black, the company’s luxury limousine service that is commercially registered and insured, is permitted. In the meantime, Uber’s future may be uncertain thanks to a recent ruling by the California Labor Commissioner that found that one Uber driver in the state met the criteria for an employee rather than a freelance contractor. While the ruling is narrow and applies only to that employee, future rulings of this nature could put the company on the hook for higher costs, employee benefits for drivers and a return to the drawing board for its business model.