uber: regulation in taxi and private hire - university of leedshead-of... · 7 growing the market...
TRANSCRIPT
Andrew Byrne, Head of Public Policy UKI, Uber
Uber: Regulation in taxi and private hire
September 9th 2016
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400+Cities(>50 in
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AND TOWNS
ACTIVE
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40k+PARTNERS
6
Competition for customers
Better service, lower prices
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New technology and services have changed how people get around for the better.
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Growing the market
Uber helps meet demand for reliable,
point-to-point transportation in
traditionally well-served and
underserved neighborhoods alike.
Serving the underserved
Improving access in and around
low-density areas
Uber helps improve access in and
around low-density areas: In New
York, 34.6% of Uber trips start or end
in the outer boroughs, compared to
6% for yellow cabs.
Uber helps meet consumer demand for point-to-point transportation services and grows the overall
transportation pie.
Good news doesn’t make
headlines
Focus is often on our fight
with taxi drivers. Raises
question: are we in the
same market?
Ply for hire Pre book
No consumer choice: price and quality regulated, often highly
so.
Can call on the street, use bus-lanes.
Time-sensitive consumers.
Urban and business centers.
Consumer choice: broad range of price and quality options.
Must book in advance.
Price-sensitive consumers.
Less spontaneous consumers.
Outlying areas.
Ply-for-hire and pre-book are different marketsDifferent products, unless regulation forces them to be the same
Transition effects are not evidence of market
definitionAnalysis must be at equilibrium.
● A switch of customers from ply-for-hire to pre book may
suggest that the markets are converging.
● However, the switch may be because of the substantive
supply-side shock to the PHV market that Uber and
similar services have provided.
● Characteristics of ply-for-hire remain materially
different.
Ply-for-hire (taxi) markets typically suffers from regulatory capture, both over time (e.g., London)
and across cities worldwide.
Regulation often restricts the numbers of licences. Where licences can be traded, the cumulative
value of these is a lower bound on the monopoly rent arising from market power. For Paris,
this is €4bn.
Passengers experience this market power in high fares, restricted supply (e.g., queues) and
services that do not adapt to customer demand.
Because the market does not work well, regulators frequently add extra regulation to patch up or
hide the problems (e.g., making licences non tradable)
PHV market has acted as a pressure-valve. As PHV gets more efficient, valve lets off more
pressure.
Market power is in Taxi’s and comes from regulation
Current risk is that regulation is extended to PHV...when it is exactly now that regulation of PHV should be updated
More choice, better quality in PHV. But
constrained by outdated regs.
But more effective pressure valve for pent-up
taxi demand.
Taxi lobby tries to close off.
No reason - PHV regulation should be
proportionate and transparent. And no need
for regional or local variation.
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In London, TfL has
introduced mandatory
call centres, language
requirements and limits
on numbers.
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In Paris, GPS has been
banned, French and
English tests and every
candidate must have at
least €1,500 in the
bank.
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And in Brussels, you
have to rent a PHV for
3 hours and our partner
drivers are forbidden to
even park on a public
road without a booking.
• Ply for hire - by its nature - needs different regulation.
• Set price and quality appropriate for area, and don’t restrict
quantity. Ensure quality is not over-specified, providers can
innovate.
• Pre book regulation can be far lighter touch due to consumer
choice. Minimum quality and safety requirements. No need for
regional variations.
• Will result, correctly, in different viable and vibrant markets
serving different consumer needs.
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Regulatory responseReflecting differences, not forcing or restricting them
Thank you
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Andrew Byrne, Head of Public Policy
+44 7921 084 395