Uber CEO Travis Kalanick introducing the company’s D.C. service last December. (Via Facebook)
Ten months after it first entered the D.C. market, Uber’s battle royale with city regulators is far from over. In fact, it’s about to enter the 24th or 25th round with the publication of a new set of proposed regulations on sedan-based livery services.
The D.C. Taxicab Commission on Wednesday proposed several dozen rules that would impose drastic requirements on what it deems “sedan-class” services. Many of the rules appear to target the business model employed by Uber, the smartphone app that hails black-car rides at the push of a few buttons. Other proposed regulations apply more directly toward the actual livery companies and their drivers, with new requirements about licensing, fleet size and due diligence.
One rule would prohibit demand pricing, in which a luxury fare is doubled or tripled during the busiest hours. Uber has used what it calls “surge pricing” on holidays like New Year’s and Valentine’s Day, multiplying its standard rates by factors as high as 6.5.
Still, much of the DCTC’s proposal has the potential to be received as particularly onerous. Under the new regulations, livery sedan drivers would be required to renew their licenses annually, companies would be required to remit per-trip surcharges and provide weekly reports of all rides. But perhaps the most daunting requirement in an industry with many owner-operators is that any company seeking to operate in the District have a fleet of at least 20 vehicles.
It didn’t take long after the rules’ publication for Travis Kalanick, Uber’s chief executive, to jump back in the fray with the D.C. regulators with whom he’s been sparring for many months.
“These rules are not designed to promote safety, nor improve quality of service,” Kalanick wrote in an email today to members of the D.C. Council. “They are intended to shut Uber and similar technology companies down.”
In a phone interview with DCist, Kalanick says that nearly a year after entering the market here, he still feels that his company is being targeted for elimination.
“It’s designed to shut down affordable sedan service,” he says of the proposed rule-making. “We’re allowing for reliable, quality, affordable transportation alternatives. That’s what we’ve enabled. And the DCTC is showing itself to be adamantly opposed to that.”
The proposed regulations will certainly be a topic of conversation before the Council’s Environment, Public Works and Transportation Committee next Monday, when Committee Chairwoman Mary Cheh (D-Ward 3) will review the latest attempt to define sedan service. The last time the Council attempted to pass legislation affecting Uber, Cheh had included language in a taxicab overhaul bill that would have established a minimum fare for sedan service hailed through a mobile application. Though it initially negotiated a price floor, Uber rebelled and called on its customers to flood councilmembers’ email and phone systems with demands to strip out that language. Rather than let a fight over Uber sink the larger taxi legislation, the Council instead drafted an amendment that gave Kalanick’s company an exemption from DCTC oversight through December 31.
Ron Linton, the chairman of the D.C. Taxicab Commission, says that Kalanick is taking the wrong view of the proposed rules. “He doesn’t know how to read the regulations,” Linton says in a phone interview.
The 20-car requirement, Linton says, is something that has long applied to regular taxicabs, which operate either individually by a single owner-operator, or as part of one of the 116 cab companies that operate in the District with fleets of 20 or more. Applying the same rule to luxury sedans, he says, would have no impact on the hundreds of owner-operator Lincoln Towncars that find business through Uber.
“You’re either going to have one and you’re an individual owner-operator or you’re going to have a fleet of at least 20,” Linton says.
And Cheh says in an email that she is reviewing the proposed regulations ahead of Monday’s hearing, where she expects to hear from the commission and possibly even representatives from Uber. In his email to councilmembers, Kalanick mentioned he is currently in town.
“Uber, and any other company or member of the community, is welcome to come and testify during the hearing,” Cheh says. “I look forward to a productive and engaging conversation at that time.”
But Kalanick is dead-set against the entire package of regulations floated yesterday, calling it “anti-competitive” and surely designed to push Uber out of the District. Moreover, he says the rules would impact hundreds of sedan operators that contract with Uber, potentially jeopardizing thousands of drivers’ jobs. By his count, Uber’s presence in 16 cities in North America and Europe has only expanded the luxury sedan livery business.
“There’s a run on Towncars,” he says. “We find in a lot of cities that we operate in that these sedan businesses are seeking out folks who have beige Towncars and painting them black.” The new regulations would demand that livery sedans be painted black by their manufacturers.
As far as surge pricing is concerned, Kalanick defends it as a method to put more cars on the road at peak times. Both Kalanick and an Uber employee in the company’s D.C. office compared the suggested ban on demand pricing with another proposed regulation that would authorize taxis to collect surcharges when ferrying customers on official holidays, after major sporting events or during presidential inauguration ceremonies.
“It’s egregious,” Kalanick said of the wider package of new rules. But it’s almost something he’s come to expect in his dealings with D.C. officials. Though Uber has had choppy entrances in other markets, most recently in Boston, nowhere has been as combative as in Washington. (A cease-and-desist order issued by the city of Cambridge, Mass. was overturned when Uber and its customers appealed to Gov. Deval Patrick.)
“Here we are again,” Kalanick says. “It’s easier to do business in Paris than it is in Washington, D.C.”
