Much excitement in the easily excitable world of the Romanian blogosphere this weekend at the news that Uber – an alternative to taxis which makes use of a mobile phone application to calculate the price of a trip – is set to open up shop in Bucharest. For the easily excitable digital-first crowd Uber ticks two very important boxes: it’s American and it’s online-only. Double whammy.
The excitement began on Friday when a local blogger who apparently calls himself Zoso (yes, really) reported that Uber was advertising for both a Romanian country and development manager.
That would certainly seem to suggest that Uber is preparing its entry into the Romanian market.
Now, for any of you unaware of Uber or how it works, this primer is well worth reading. In brief, Uber allows car owners to offer spare capacity in their vehicles to paying customers via a mobile application. The price is agreed before the journey commences, according to the distance to be travelled. No cash changes hands: each account holder pays via a registered debit or credit card. Uber takes a 20 per cent cut of every fare.
Recently valued at $18 billion, Uber has been phenomenonally successful in many towns and cities in the United States, as well as ruffling a few feathers in Europe. Uber does best in those cities where it disrupts the long-standing, expensive monopolies of licensed taxi drivers. And here’s the problem for Uber in Bucharest: the city already has what are amongst the cheapest taxis in the developed world (do your own gags). Taxis in Bucharest are also ubiquitous (usually: less so in the rain) and – for a good couple of years now – you have been able to order one using a highly efficient mobile app, Star Taxi.
We therefore fail to see how Uber fits in, unless there is a market for people who actually want to pay more for a taxi in order to travel in a little more comfort than a Dacia Logan offers (the vast majority of Bucharest’s taxi being Logans). (In which case, there is already Black Cab).
We have been told that Uber will solve one of the biggest gripes people currently have with Bucharest’s taxi drivers: their refusal to travel short distances. We doubt that will be the case. Given that Uber requires users to state both pick-up point and destination when ordering a car, Uber drivers are in fact less likely to answer a request for a car. And Ubers cannot be hailed in the street. The second argument, that they will bring an end to high-prices at New Year and such like is also null: Uber practices surge pricing at all busy times.
By the way, if you do ever want to take a taxi a short distance make it clear to the driver as you get in that will pay 10 lei even though the fair might only be four or five lei. (Indeed, as a general rule, never pay less than 10 lei: to do so is a little bit rusinica, as they say in these parts).
Anyway, we wish Uber well, and do at least hope that they will get the chance to fail: some cities (with powerful taxi lobbies, notably London and Berlin) have tried (and in the case of Berlin succeeded) to have Uber outlawed.
Bucharest’s taxi drivers will almost certainly try and do the same. We would advise them to simply keep their prices down: Uber will not be able to compete with taxis charging 1.39 lei per kilometre.