(Original edit of article for Taxi magazine).
At this year’s UK Bus Summit, TfL Managing Director of Surface Transport, Leon Daniels, warned that London’s buses are under threat by Uber. I found the idea unlikely at first, but the dynamic of transport is certainly changing. Could low mini-cab fares really herald the decline of the bus?
What’s certain is a race to the bottom between private hire operators, and with buses being the cheapest form of transport in London, they could prove to be the most vulnerable should private hire fares become cheaper. Transport users in London are familiar with the long line of red on Regent Street and Oxford Street, and they know they’re in for a long journey should they choose the bus option.
Transport users know a taxi can be an expensive option, but we’re popular because we offer a private door-to-door service, and we’re quicker than the buses. Regular customers also know we are increasingly prone to get stuck in traffic though, and if we get caught in heavy traffic, a £15 fare can easily become £20 or £25, or even £30. And there’s no definitive rush hour; we can get stuck in traffic at any part of the day – and on any day too; weekends aren’t exempt.
Tourists like to ride in a cab, and we’re useful to people with luggage using train stations. Taxis also serve the huge Taxicard account for customers with limited mobility, subsidised by the London boroughs. Apart from that, we’re largely used by those with a bit of money. Not so well off people might use us for a quick dash to Euston or Waterloo, but it’s a gamble. People are wary because of the possible cost implications.
Private hire gained a measure of respectability when they became officially licensed, and the smart corporate image of some of the companies has attracted higher-earning individuals, as well as corporate account customers. Uber’s use of the app. is nothing new, but few people seem to be aware that new technology is available to book a taxi. Computer dispatch and phone applications have been used by the London taxi trade since they first became available. There’s some good publicity coming out to publicise alternative ways to hail a taxi, and it’s positive that all taxis will be known to process credit cards from October.
Although trade is still depressed, I’m confident that our position will strengthen. Established private hire companies are surely having it harder than us, and if Uber cuts its fares, other private hire companies will have to follow or risk going to the wall. I can see private hire being in the hands of just a few mega-companies before long. How low can the fares go? Low enough to challenge the buses?
Mr Daniels seems to think so, when he reminded the busmen that their opposition offer a personal, door to door service, and that private hire can work out cheaper than the bus if there are more than one of you travelling. The taxi trade has had advertising campaigns pointing out that any cab fare applies to the whole vehicle: five or six passengers. Not everyone considers this, so it’s useful to point it out. If there are a few of you, taking a taxi to Heathrow is cheaper than taking a train, particularly when you have to get yourself to Paddington first. Even a cab ride to Gatwick, Luton, or Stansted, can be cost effective.
So what if private hire targeted the buses and took more work from them? What if the bus companies didn’t find it economical to run to current timetables and cut some buses? Waiting times between buses would increase, and private hire (and taxis) would become more attractive. Passengers fed up of waiting for a bus will increasingly reach for their mobile to book an Uber, or flag down a passing taxi. Yes, what benefits Uber could benefit taxis too. Road congestion would be lessened on many routes, benefitting everybody. The reduced bus fleet will cause less congestion, and minis and taxis will be moving around faster. Imagine no more queuing to get around Trafalgar Square or Piccadilly Circus! The cleaner air will also keep everyone happy.
Through their publicity machine, everyone has heard of Uber. Everyone knows they can download their app. and have a car arrive after a few minutes. It’s also a global brand, so there’s a certain element of trust. If successful, they could challenge the Heathrow and Gatwick Express trains, and maybe have a pop at the Oxford Tube too for good measure. With their power, will Uber get permission to take Oyster cards? I wouldn’t bet against it.
Their fares will surely have to get even lower though. I don’t think drivers’ disputes over Uber’s commission will bother customers so much. The fact is that people just want a cheap service, and Uber, and private hire generally, is seen as a relatively inexpensive option.
But they are a fashionable brand, and fashions come and go. As a fashionable brand, Uber are reliant on a sympathetic media to promote them, and also on celebrity endorsement. Publicity over Uber’s tax arrangements make people with a conscience think twice; as well as reports on some drivers’ criminal activities, insurance irregularities, and unorthodox route planning. Should the glamour wear off, they haven’t the history or tradition to sustain a fickle London public’s interest. The tide could turn against them. If they do establish themselves as a serious challenge to the buses they might be tempted to put up fares again, and to increase their surge pricing periods. We could all go back to square one again. Then what? Who knows!
Copyright: Chris Ackrill, 2016.