Uber pleads with London
This article is about Uber and the CEO pleading with the city of London to lift a ban on the ride-sharing service. Within the past week, London city officials have said that they will not renew Uber's license to operate in the city due to "a lack of corporate responsibility". Uber has faced many controversies recently and have just ousted their co-founder and CEO for PR problems and allegations.
The new Uber CEO, Dara Khosrowshahi, has been trying to repair Uber's image and get the company back in the spotlight in a positive manner. Khosrowshahi inherited a ton of PR and investor problems, as many both inside and outside of the company have pushed Uber to make corporate and structural changes.
Uber is still a private company, and is looking to have an IPO soon. These controversies and negative press has definitely taken a toll on the companies value, as consumers are starting to prefer other ride-hailing services like lyft. Uber must mend its image and reinvent its company culture if it wants to get back into the good spotlight.
Uber is a company that runs on margins and they rely on many rides being done in order to make money. Uber has struggled in recent years to make profit, and it is important that Uber does everything it can to increase and keep market share as well as keep the number of riders that use the app.
This article is mostly about the CEO pleading with the city via twitter to renew their license. His argument is that millions of Londoners have used Uber and rely on it as a form of transportation. He is claiming that Uber already has an established following and that those customers need the app. It will be interesting to see the outcome of this as London is a massive city with many visitors, tourists, and travelers. Hopefully, London will be able to work it out with Uber, as I believe Uber makes the market more efficient as it lowers prices consumers pay. Uber competes with regular taxi services, and their ability to provide cheap rides make the market more competitive.
http://money.cnn.com/2017/09/22/technology/business/uber-london-ceo-dara-khosrowshahi/index.html
Since Uber has been banned in the London metropolitan area, it would be a great time for Uber's main competitor, Lyft, to enter the market. According to The Telegraph, UK's leading newspaper, Lyft has had recent meetings with officials at the Transport for London along with City Hall. If Lyft should be approved, I believe they would take control of the ride-sharing market in London even if Uber should renew their license. This also depends on the timing. I would imagine current Uber users and drivers would switch to Lyft if it was the only ride-sharing service available. With Lyft's driver rewards program, it could raise the switching costs for drivers even if Uber re-entered the market. As most know, the public taxis in the City of London are incredibly expensive in comparison to ride-share services such as Lyft or Uber and it will be interesting to see how this plays out with London Transport Officials.
ReplyDeleteI read basically the same article about London's ban on Uber. The CEO should also argue the fact that 40,000 people in London alone are employed through Uber and all of those people will be out of jobs come September 30th. I agree with Aaron, though. This would be a great time for lyft to get established in London as they wouldn't have much competition besides taxi services. Uber being banned allows another company, such as lyft, to take over the market.
ReplyDeleteAs London is one of the largest cities in the European market, Uber's ban may ultimately have a beneficial outcome in terms of the consumer. Since Uber has was founded in 2009, it has ushered in an entirely new form of easy transportation. In order for the consumers to have the best and most financially efficient mode of transportation, however, Uber cannot hold a monopoly in this arena. This likely temporary ban on Uber, at least until it is able to rebrand itself to London's city officials, could make room for other companies, like Lyft, to become more established in Europe. This would create a more competitive market, which could ultimately benefit the consumer.
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ReplyDeleteLondon's Ban on Uber will undoubtedly have an effect on both London and Uber's Sales in Europe. While this ban will likely prove to be temporary, London offers many other forms of transportation. The use of this transportation will likely rise, proving Uber's competitive business model against the city transportation. Due to a rise in consumer demand, along with a sharp recent spike in popularity, Uber will once again be in London but the question stands; when? Amid stronger and stronger consumer demand the Officials of London will soon be on the hot seat to come to an agreement between the city and Uber.
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