International Business

Uber Gets Banned in London

It has been a tumultuous last couple of months for the ride hailing company Uber. After facing a lot of heat in the media for their internal affairs in the company, they recently named Dara Khosrowshahi as the new CEO after Travis Kalanick was pressured to resign from the company [1]. Everyone in the business world has since been holding their breath in anticipation wanting to see if this new move would help rebuild the brand loyalty in customers and businesses alike. However, the city of London is not buying into it, at least not yet.

In September, Transport for London (TfL) refused to give Uber a new private hire license, citing that on the grounds of “public safety and security implications,” the firm was not fit and proper to operate within their city limits [2]. This decision makes London join a long list of cities, states, and territories that no longer allow the company to operate there, including Bulgaria, Italy, Alaska, Vancouver, China, and Austin, Texas [3]. Until the TfL feels that the company has made significant progress in decision making and has undergone a thorough reform of their morals and ethics, they are not interested in doing business with the company.

The immense amount of pressure Uber has been under recently has stemmed from the decisions and actions they have made. Former head of Uber’s Asia-Pacific business, Eric Alexander, left after a report surfaced saying he had obtained the medical records of a woman being raped by an Uber driver and done nothing about it. There was also the report that Board member David Bonderman made a sexist remark at a meeting that was about workplace practice recommendations and as a result resigned from his post. Then, in February, Uber investigated sexual harassment claims made by their former engineer Susan Fowler. Finally, this past month of June, Uber announced that they had fired more than 20 staffers and taken actions against other employees after an investigation on harassment, discrimination and inappropriate behavior that happened in their company [4].

This sort of transgression of events only happens when there are deep issues in a company. It makes you start to wonder if this is the scandals that have gotten leaked to the public, what else are they covering up within their business? Employees in the company have cited that there is a premium placed on workers who deliver strong performances and personal growth, no matter the means they take to get there [5].

What does all of this mean for the average citizen? Well, some 3.5 million passengers and 40,000 drivers use the Uber app in London alone [2]. For a tourist that has never used the public transportation in a new city, Uber can be a means to get where they need to go that they’ve used before in their home country. According to Business Insider, in terms of London has the 4th most complicated underground subway system in the world, only placing behind New York City, Paris, and Tokyo, respectively]. For the study, “they considered all the trips a traveler could make from Point A to Point B with two connections, then determined the fastest possible path for a given trip” [6]. For someone that has never navigated the London Underground, Uber is a convenient means of traveling until a person is more comfortable and confident with navigating the public transportation.

Image result for london bus

Student Jacob Fernandez cited London’s confusing bus routes as a reason Uber should be permitted to stay in London.

Even when the average citizen does get comfortable using the London Underground, or public transportation system in general, Uber still stands out in its convenience. For example, student Jacob Fernandez recalls from his study abroad experience in London that, “at night time the bus routes are not the same and run infrequently, so it was much more convenient to just call an Uber to the location you were at.” With Uber no longer as in an option in the future for city dwellers, Londoners will have to resort to something else to get home.

Uber responded to this news by appealing TfL’s decision, which means they can continue to operate in the city until the appeals process is over. This at least buys them some time to continue to change their company image in the hopes that London will become satisfied and change their decision. London took a bold move by not renewing Uber’s license to operate in the city, but it remains to be seen if other major cities in the world will take an initiative like this one.

[1] https://www.economist.com/news/business-and-finance/21727855-he-must-tackle-huge-losses-lawsuits-and-meddling-predecessor-uber-picks-dara

[2] http://www.bbc.com/news/business-4606965

[3] http://www.independent.co.uk/travel/news-and-advice/uber-ban-countries-where-world-taxi-app-europe-taxi-us-states-china-asia-legal-a7707436.html

[4] http://www.bbc.com/news/business-40351859

[5] https://www.nytimes.com/2017/06/06/technology/uber-fired.html

[6] http://www.businessinsider.com/worlds-15-most-complicated-subway-maps-2016-2/#1-new-york-city–the-most-complicated-subway-map-1

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