Gig economy update.

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Following its first international lunch in Australia in late February 2018 Ola the Indian ride-hailing app has announced plans to launch in the UK.  Having secured operating licences in South Wales (from September) and Greater Manchester (start date?) Ola is in discussion with other local authorities regarding its ambitious plans to expand across the UK commencing by the end of 2018. One of Ola’s selling points is that model differs from many others in that it will apparently allow the customer to choose between an app hailing vehicle or a traditional “black cab”.

Ola will not only provide competition to established traditional taxi firms but also to Uber and other ride-hailing app companies operating in the UK.  However, some commentators note that the Japanese investment group SoftBank which holds large stakes in both Uber and Ola are pushing for a merger between the two company’s Indian operations.  Whether this goes ahead or not it will have no direct impact on UK operations. Although it may be fair to assume that given SoftBank’s involvement there might be more room for cooperation and a degree less competition between Uber and Ola in the UK than the original announcement would suggest?  Only time will tell.

In the US the Mayor of New York has imposed a limit on the number of ride-hailing app vehicles operating in the City by imposing a moratorium on new licences for a 12-month period (less wheelchair accessible vehicles) whilst they assesses the impact of 80,000 plus vehicles operated by 4 main ride-hailing app companies. The new bill also gives powers to regulate minimum rates of fare, minimum rates of pay for drivers and create, “a new rule book”, for app companies.  The restrictions should give some comfort to the drivers of the City’s 13,500 yellow cabs who have seen their livelihoods damaged by the rapid and vast increase in competition.

The headline reasons for the City’s actions are cited as concerns over traffic congestion and the impact of low pay for drivers both of which the app companies dispute.  The promised study into the impacts of ride-hailing apps in New York, the largest US market, could prove to be informative to other authorities who, in the face of game changing new technologies and new business models, are wrestling with the question of what is appropriate regulation for taxi and private hire operations.

Links to articles on both subjects have been added to our gig economy page which can be found as a drop-down menu from the “Sharing economy” main menu tab on Britishdestinations.net or go direct to the page at: https://britishdestinations.net/tourism-the-sharing-economy-and-its-wider-implications/gig-economy/

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