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Uber urges SA's metered taxi drivers to compete with technology

Uber urges SA's metered taxi drivers to compete with technology

Uber is encouraging South Africa's metered taxi drivers to embrace technology in order to access what the company says is abundant economic opportunity for ride-hailing apps across the African continent.

Uber's appeal comes as aggrieved members of the SA Metered Taxi Association on Friday 10 March blocked off highways and entrances to O.R Tambo International, the country's busiest airport, in their latest protest against the US-based private car service.

Justin Pratt, Head of Business at Uber Sub-Saharan Africa believes the Association's upcoming launch of a new taxi hailing app, YooKoo, should be encouraged in order for their business to remain sustainable.

"We like competition. We think competition is very healthy in this space. There is just so much to do that I don't think that one can do it all. We encourage that innovation. My personal view is that technology is pretty much good everywhere. I find it very hard to find use cases where technology has been bad."

Pratt says Uber itself is looking into more opportunities to invest in the Africa's taxi hailing industry.

"There is going to be significant investment from us in this continent. We care deeply about trying to provide transport to everybody. I think Africa is a continent that can really use the connecting of economic participants to economic opportunity. We are massive believers in that and a lot of people really care about it, so we are excited about where we are going."

Pratt says Uber's plan to expand on the content is buoyed by the rise in mobile penetration which the company expects to reach 90% by the end of 2017, a drop in the price of smartphones and increasingly affordable access to the internet, among others.

"The ability to create macroeconomic growth resides here, on this continent, and this continent alone ten years from now will see even more mutual, trust-fund, private equity and VC money chasing opportunity. They are in India at the moment, but China is already done as far as the investment upside, so what does that mean? I think that they are going to come here and that is the generator of a lot of that opportunity."

Metered taxi app in the works

Kenny Niemach, Chief Operations Officer of Yookoo Incorporated, says metered taxi drivers are taking steps to challenge Uber with technology.

"We created this taxi application for the South African Metered Taxi Association. We recognise their plight, we understood what their situation was, simply because you had another company coming into the country and opening a parallel business. We took it upon ourselves to approach them, we spoke to them and they said we can assist them and we are now just finishing up the legalities of the agreement. Essentially we are in partnership with them."

Niemach says security and entertainment features on the new app will set it apart in the market and plans are in place to ensure that the cost of the rides becomes the main differentiator, although fare details are not yet available.

"We will complete all the legalities next week after we meet the taxi association. We want to launch in Gauteng by the middle of April 2017 after we do all the vetting and get all the guys on the system. This is not just us providing them with technology. We want to be competitive. We also want to restore their dignity and revitalise the industry for them because there is going to have to be support structure in terms of the vehicles, in terms of the call centres and etiquette training. There is a lot involved and so it is not going to be a once-off project."

Niemach would not reveal the extent of ownership that the SA Metered Taxi Association has in Yookoo which he says will be rolled out in the rest of South Africa, in other parts of the continent as where there has already been interested in doing so, expressed by some in the transport sector.

He also believes that strike action taken today by metered taxi drivers, a few weeks ahead of Yookoo's launch, is neither premature nor contradictory.

"You can't quell anger. These are people who have paid government for these routes. They have paid government for these meter taxi association licenses and then you get someone operating a parallel business who has paid nothing, but is eating off their payroll. I don't think the public has made time to figure out why this is. You have someone paying a lot of money for the routes and someone from outside comes and replicates your business with a newer car and all of a sudden has taken three-quarters of your business. The SA Taxi Metered Association drivers are suffering and people need to understand this. We can't always have an accusation of 'why are they doing this?'... we need to look at both sides and see what Uber has done to the industry."

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