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European Taxi Unions Merge to Create United Front Against ‘Uber Lobby’

The unions and banding together to combat "unlawful competition."

by Sam Edwards
Nov 1 2016, 10:00am

Taxis lined up in Madrid. Image: Wikimedia Commons

In Spain, as in almost all other markets it has entered, Uber has faced pushback from authorities, protests by taxi drivers, and a rash of rival startups looking to get their own piece of the lucrative ride-hailing market. But the latest attempt to challenge the US company's hegemony in the taxi app market is a different beast. Perhaps realizing the difficulties in relying on regulation to keep Uber out, taxi drivers in Spain announced this week plans to create their own app.

This is not the first time taxi drivers have tried to beat Uber and its ilk at their own game. The last few years have seen a rash of rival apps brought out by taxi drivers, but this approach faces considerable challenges, not least winning over customers from big, established brands with multi-billion dollar budgets.

Spain's Fedetaxi union hopes its approach will be different. At its AGM last week, Spain's largest taxi union merged with several rivals and announced plans to form a pan-European alliance with the aim to "fight the Uber lobby in Brussels."

Union leader Miguel Ángel Leal said Fedetaxi would welcome all drivers who wanted to create a common front against the "intrusion" and "unlawful competition" of multinationals.

"Fedetaxi is home to all taxi drivers, with the exception of those who, betraying the industry and pursuing only profit, have moved to the [private chauffeur services sector]," Leal said.

If all goes to plan, the European Taxi Alliance will be up and running by December.

"We will continue working to push for regulation of taxis as a public service that doesn't strip independent drivers of their jobs and their income and deliver that which they have spent a lifetime defending to private multinationals who monopolize transport under the guise of being collaborative companies," reads a Fedetaxi press release.

For all their outrage, however, taxi drivers have struggled to halt the growth of ride-hailing apps in Spain. After spending all of 2015 banned from operating in Madrid, Uber returned to the Spanish capital this spring, though the company is limited to city center and can only employ professional drivers. Further afield, Uber's return to several high profile European cities has raised alarm, while there is increasing belief that focusing solely on efforts to regulate apps is a losing tactic.

Protests against the ride hailing app have appeared to have a negative effect, such as the 2014 London black cab strike which reportedly precipitated an 850 percent increase in signups to Uber as a result of publicity from the industrial action.

Leal is clear that the way forward is to create a professional app that can compete with market leaders.

"We need to get serious because right now with have a ton of 'apps' but none of them are competitive," he told El Confidencial last Wednesday.

The goal, according to Leal, a create something similar to My Taxi, the app owned by German carmaker Daimler. My Taxi, in contrast to Uber, works exclusively with licensed taxi drivers. After announcing plans to merge with its former rival Hailo, My Taxi looks set to dominate the European market, and has tried to court taxi drivers by positioning itself as the only alternative to Uber.

For Leal, however, the industry needs its own app if it is to avoid becoming a hostage to the strategies of large companies. My Taxi is already unpopular among some for discount strategy. In Germany earlier this year a court ruled that My Taxi's discounts for paying through the app were illegal and constituted "unfair commercial practice."

Taxi drivers in other countries appear to be coming to similar conclusions about the future of their industry. In August, Mumbai taxi drivers reportedly decided to stop industrial action in favor of creating their own app to compete with Uber.