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UK News Uber boss admits app is suffering 'higher driver cancellations'

17:20  19 september  2021
17:20  19 september  2021 Source:   dailymail.co.uk

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a man holding a phone: MailOnline logo © Provided by Daily Mail MailOnline logo

Why it's become so hard to get an Uber: Perfect storm of problems facing customers wanting a ride

Lack of drivers

Uber has lost thousands of drivers since the start of the Covid pandemic, according to those working with the service. Many drivers are understood to have swapped taxi driving for takeaway deliveries following a huge drop in demand for cabs during lockdown. Uber says it wants to recruit 20,000 new drivers by the end of 2021.

Surge pricing

A lack of drivers has led to an increase in surge pricing, some say. The app automatically raises prices to match increased demand. With less Uber drivers around, surging happens more, drivers say.

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Drivers using rival apps

Uber drivers are allowed to use rival ride-hailing apps at the same time. This allows them to pick and choose the best fares. But it also means drivers can cancel trips enroute to pick-ups if they find a better fare, leaving users facing a longer wait.

Trips not worthwhile for drivers

Because Uber does not pay its drivers to get to a customers, drivers say short trips which take a long time to get to aren't worthwhile. It means if you are far away from a group of drivers, and it is a short trip, it may not be economically viable for them to pick you p.

Low Traffic Neighbourhood schemes causing a nightmare

On top of that, Low Traffic Neighbourhood schemes are making it harder for taxi drivers to reach their customers, discouraging them from accepting fares.

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An Uber boss has admitted the cab-hailing service is suffering 'higher driver cancellations', with frustrated customers experiencing longer waits for a pick-up as drivers ditch jobs they don't think are 'worth the fare'.

MailOnline previously revealed that users were finding it harder to get an Uber after 'thousands' of drivers quit the app since the start of the Covid crisis - with many now working for takeaway delivery firms such as JustEat, Deliveroo and sister firm UberEats.

Jamie Heywood, Uber's general manager for northern and eastern Europe, has now admitted that the app is suffering higher driver cancellations, with 35 per cent of cars now taking five or more minutes to arrive.

Speaking to the Sunday Times, he said some of these problems can be traced back to a decision to introduce 'upfront pricing' last October, giving driver and passenger a fixed price for the journey.

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Though it is meant to be fairer than the previous system of an estimated price range, drivers say they lose money if traffic is heavier than expected or if they must make a diversion.

The price is only revised upwards if they have to drive at least 40 per cent further or for 20 per cent longer than calculated.

It can take a while to work out if a job is worth accepting, and drivers suffer no penalty if they reject it. Many other drivers also work for one or more of Uber's rivals, so they can scroll on through other, better offers and ditch a fare to avoid risk.

Mr Heywood said that demand for Uber has risen by as much as 40 per cent in some cities since the end of lockdown as many people seek to avoid public transport - which has has left him looking to recruit an extra 20,000 drivers to add to the 70,000 regulars.

Uber increased the service rate from 20 to 25 per cent for thousands of drivers after Supreme Court judges in the UK ruled the company must give its workers benefits such as holiday pay.

To keep their take-home pay up, drivers are taking to 'multi-apping' - using other ride-hailing services such as Bolt and FreeNow at the same - in order to pick-up the highest fare.

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But it means passengers waiting for an Uber are regularly having rides accepted, only to have them cancelled while the driver is en route.   Some disgruntled passengers say they have waited more than 10 minutes for a ride in London - where pick-up times were previously a matter of minutes.

On top of that, cabbies have continued to rail against the dreaded Low Traffic Neighbourhood schemes (LTNs) which are making it a nightmare for drivers to reach customers.

Disgruntled users have meanwhile vowed to no longer use Uber due to its long wait times and  'crazy' prices. One customer previously told MailOnline: 'I use Uber quite a lot but have now decided to use other apps. I realised that it takes ages to get a ride.

'I had to wait around 10 minutes once for a service, and have also had rides confirmed thinking I would be on my way out just for it to have it cancelled - and this happened more than once.'

a person standing in front of a building: Jamie Heywood, Uber's general manager for northern and eastern Europe, has now admitted that the app is suffering higher driver cancellations, with 35 per cent of cars now taking five or more minutes to arrive © Provided by Daily Mail Jamie Heywood, Uber's general manager for northern and eastern Europe, has now admitted that the app is suffering higher driver cancellations, with 35 per cent of cars now taking five or more minutes to arrive a hand holding a cellphone: An Uber boss has admitted the cab-hailing service is suffering 'higher driver cancellations', with frustrated customers experiencing longer waits for a pick-up amid a driver shortage and surge pricing © Provided by Daily Mail An Uber boss has admitted the cab-hailing service is suffering 'higher driver cancellations', with frustrated customers experiencing longer waits for a pick-up amid a driver shortage and surge pricing

How do the prices compare?

MailOnline price checked the leading ride-hailing app to see how their prices compared. The figures are based on a trip from our office in Kensington to Trafalgar Square and were all quoted around 11am on August 12.

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Uber - £11.81 for a standard vehicle

graphical user interface, application © Provided by Daily Mail

Bolt - £5 (with discount offer of 50 per cent)

graphical user interface, application, map © Provided by Daily Mail

FreeNow (formerly Hailo) - £14 - £18 for a black cab

diagram © Provided by Daily Mail

Drivers previously told MailOnline how the issue began at the start of the Covid pandemic, when demand plummeted due to the Covid lockdown in the UK.

Uber driver Nader Awaad said 'thousands' subsequently quit the ride-hailing app, because many were unable to make a living nor claim financial support.

Others were forced to take out Covid support loans to tide them over during the pandemic.

Mr Awaad, who is the elected chair of United Private Hire Drivers (UPHD), said many of the drivers began working for delivery firms such as sister company UberEats, and rivals such as JustEat and Deliveroo.

He previously told MailOnline: 'I had to take out a £20,000 loan at the start of the pandemic.

'I didn't stop driving. I was driving seven days a week to keep myself going.

'Not everyone was able to do deliveries, my car is a Mercedes so it wouldn't work for me. But that's why we lost a lot of drivers.'

He says the situation has been made worse by an effective cut in pay for thousands of Uber drivers.

Uber increased its service fee for many drivers following a Supreme Court ruling in the UK in February.

The ruling meant that Uber drivers are now classed as 'workers' rather than contractors and thus entitled to benefits such as holiday pay.

Uber later moved its longer serving drivers from a 20 per cent service rate - the cut it takes from each fare - to a rate of to 25 per cent.

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Bosses of the ride-hailing app say the move was to 'standardise' the charge. Uber said newer drivers were already paying this higher rate prior to the court judgment.

But Mr Awaad says that some trips for Uber drivers are now no longer worth taking, particularly in the midst of rising fuel prices.

He says drivers are also not paid for their journey to the customer, meaning many drivers are rejecting trips which are not in a close vicinity.

This, along with the increased service charge, he says, has resulted in some drivers taking to 'multi-apping'.

Multi-apping, which is permitted by Uber, is when drivers have numerous ride-hailing apps opened at one time.

For example, a driver can be searching for an Uber customer and one from rival ride-hailing app Bolt at the same time.

Mr Awaad says this allows drivers to pick and chose the best fare. He said: 'I feel guilty cancelling a trip, but drivers are just driving to maximise the price.

'If Uber pays £15 for a trip and Bolt pays £25, what are you going to? That's why customers are waiting for so long at the moment. It's chaos.'

Mr Awaad also said drivers often boost their income by driving in 'surge periods'.

Surge times are essentially public transport peak periods, where prices are hiked to reflect demand.

Unlike traditional peak periods though, Uber surges can happen late at night, such as pub or club kick-out time, when there is a spike in demand for Ubers but not as many drivers.

However, Mr Awaad said that due to a lack of drivers, Uber was now 'surging all the time'.

'It's not fair on the customers,' he previously added.

Uber users have noticed the changes, with many previously taking to Twitter to moan about the service.

One Twitter user wrote: 'You legit have to allow an extra 20 minutes to your journey when using Uber.

'You have to wait so long for them to connect to a driver and it's almost guaranteed that you'll be cancelled on. Sort it out.'

Fears of taxi fare price hike amid petrol crisis

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Another wrote: 'Wait 10 minutes, finally connect with a driver... ALWAYS get canceled on at least once before they connect you with another 10 mins away. Such an awful service these days.'

Meanwhile, Twitter user Samia, previously added: 'Never using Uber again.  Every time I try to book a ride home from central London it gets cancelled by at least five drivers.

'I have a 4.5 rating. It ends up taking longer to book an Uber now than to get home for me.  I took a black cab home and it was cheaper including my tip!'

Others previously took to Twitter to complain about the 'crazy prices' they are being charged.

One wrote: 'I spent £13 on an Uber for Hockley to The Park Estate the other night... make it make sense.'

Another claimed they were quoted more than £70 for a trip from Croydon to east London.

Union bosses previously pointed the finger at Uber for the drop in service.  Charlie McNamara, branch coordinator at United Private Hire Drivers (UPHD) told MailOnline: 'Employers often complain about not being to get enough employees while paying low wages. This is one of those cases.

What as the Supreme Court ruling in the Uber case?

In February the UK's Supreme Court ruled in favour of drivers being classed as 'workers' after a five year battle.

Drivers were previously classed as self-employed 'contractors' by Uber, meaning they were not entitled to benefits in the same way paid employees are.

But, in a landmark ruling for the gig economy, Supreme Court judges ruled that drivers should be classed as workers and therefore be given the same rights.

It meant Uber faced having to pay workers millions in back-dated compensation, while newer drivers would have to be given pay for holidays going forward.

The taxi giant had argued its 60,000 UK drivers were independent contractors and so not entitled to employment benefits.

But judges instead ruled that Uber's 'very tightly defined and controlled' business model and fares process meant drivers were in 'a position of subordination and dependency' - and could not be deemed 'independent contractors'

'Drivers need to be able to make a proper living and that's leading to this drop in service.'

Out of Uber's control is another problem for it and many other cab drivers - dreaded Low Traffic Neighbourhood schemes.

The schemes have wreaked havoc for drivers, particularly in London, where borough chiefs have closed off roads to essentially create giant cycle lanes and walkways.

Bollards or large planters are often installed, blocking once easy driving routes and sometimes creating long diversions.

Drivers, who already say they are struggling to make-ends-meet with some Uber trips, say LTN schemes make some trips even hard by forcing them to quite literally 'go-round-the-houses' to reach or drop off passengers.

The United Trade Action Group, a union group supported by taxi drivers, has been appealing against Transport for London schemes installed as part of its much-maligned Streetspace project.

However, last month, The Court of Appeal upheld TfL's appeal against a January ruling which declared parts of LTN's unlawful.

Meanwhile, another element of concern for Uber, who once held the monopoly on ride-hailing apps, will be the rise in competitor service Bolt.

The service was launched in 2013 by Estonian entrepreneur Markus Villig, who is just 27 years old.

The company, previously known as Taxify, now operates in more than 45 countries.

It was revealed the firm had €600million (£453million) from venture capital funds to grow the business.

Speaking to the Telegraph, Mr Villig, who is still only 27, said: 'We have a very different mentality from some of the usual Silicon Valley companies which just raise billions and billions of funding.'

a close up of a car: One element of concern for Uber, who once held the monopoly on ride-hailing apps, will be the rise in competitor service Bolt (pictured: A Bolt vehicle). The service was launched in 2013 by Estonian entrepreneur Markus Villig, who is just 27 years old. The company, previously known as Taxify, now operates in more than 45 countries. © Provided by Daily Mail One element of concern for Uber, who once held the monopoly on ride-hailing apps, will be the rise in competitor service Bolt (pictured: A Bolt vehicle). The service was launched in 2013 by Estonian entrepreneur Markus Villig, who is just 27 years old. The company, previously known as Taxify, now operates in more than 45 countries.

From market leading Uber to a not-for-profit black cab hailing app aiming to keep Hackney Carriages on the roads: What taxi apps are the out there for customers?

Uber

The pioneering firm that changed cab services forever. Launched in March 2009 by founder, Canadian entrepreneur Garrett Camp, Uber is by far the market leader in the ride-hailing industry, with an estimated 93million users worldwide.

It has users in 69 countries, a total of 900 metropolitan areas worldwide, including in many large towns and cities in the UK.

a man standing in front of a sign: Launched in March 2009 by founder, Canadian entrepreneur Garrett Camp, Uber is by far the market leader in the ride-hailing industry, with an estimated 93million users worldwide © Provided by Daily Mail Launched in March 2009 by founder, Canadian entrepreneur Garrett Camp, Uber is by far the market leader in the ride-hailing industry, with an estimated 93million users worldwide

London, Manchester, Birmingham, Southampton, Cardiff in Wales, Edinburgh and Glasgow in Scotland and Belfast in Northern Ireland, are just some of the cities Uber operates in the UK.

The company, based in San Francisco, had a net income of $6billion last year, despite a drop in demand during the pandemic, and last month was estimated to be worth $100billion.

In 2014, the company launched its own delivery service, UberEats, which delivers takeaway food via car, bike, scooter or on foot. It has seen a huge spike in demand in the UK since the start of the pandemic.

Bolt

The biggest challenger. Bolt was launched in 2013 by Estonian entrepreneur Markus Villig - who is now 27 but launched the firm when he was just 19 years old.

The company, previously known as Taxify, now operates in more than 45 countries and is estimated to have 75 million customers globally.

a green car parked on the side of a road: Bolt was launched in 2013 by Estonian entrepreneur Markus Villig - who is now 27 but started the firm when he was just 19 years old © Provided by Daily Mail Bolt was launched in 2013 by Estonian entrepreneur Markus Villig - who is now 27 but started the firm when he was just 19 years old

Much like Uber, users hail rides, rent cars, electric scooters and e-bikes and order food delivery from their smartphones.

Just this month it was revealed the firm had €600million (£453million) from venture capital funds to grow the business.

FreeNow

The young gun. FreeNow is Germany's answer to Uber. It was launched in 2019 as joint venture between BMW and Daimler Mobility.

However, the company has part of its roots in Britain, back in 2011, with a company called Hailo. Hailo, best known for its bright yellow taxis.

The company was launched by Daimler's MyTaxi in 2016. And MyTaxi was later rebranded in 2019 to FreeNow.

Like Uber and Bolt, users can order a cab - as well as a scooter - through a mobile app. It is estimated to have around 10 million users and currently operates in 100 European cities, including Madrid, Berlin, Dublin, Paris, Milan and London.

It also operates in other UK cities such as Brighton, Manchester, Oxford, Nottingham and Reading.

TaxiApp UK

The black cabbie answer to Uber. TaxiApp UK was launched with the mission of keeping black cabs on the road. It is a non-profit co-operative owned and operated by black cab drivers.

a truck on a city street © Provided by Daily Mail

The app, which is available on Apple and Android phone, allows users to hail a Hackney Carriage. You can also track the taxi's process as the driver makes their way to you.

The big boast? Well, as with all Hackney Carriage drivers, it's all about the famed 'Knowledge' test - which cabbies take to prove they know the streets of London. Your driver will be using their brain rather than a sat-nav to get you to your destination.

Users can pay through cash, as well as on card and through the app.

GETT UK

Corporate black cabs. Gett is another black cab-hailing app, though not a non-profit like TaxiApp. Its corporate services are available in 135 countries. Its big boast is that it serves a quarter of the Fortune 500 companies.

a hand holding a cell phone: Gett is another black cab-hailing app, though not a non-profit like TaxiApp. Its corporate services are available in 135 countries. Its big boast is that it serves a quarter of the Fortune 500 companies © Provided by Daily Mail Gett is another black cab-hailing app, though not a non-profit like TaxiApp. Its corporate services are available in 135 countries. Its big boast is that it serves a quarter of the Fortune 500 companies

Last year it became the UK's first ride-hailing app with the option to book exclusively electric taxis.

Founded in 2010 in Israel and headquartered in London, Gett has raised more than $750M in funding to date.  It had a revenue of $166 million in 2020.

Addison Lee

Driving in style. Addison Lee is a London based private cab hire and courier company. It was launched in 1975 by British businessman John Griffin.

The company now has 4,000 vehicles with annual revenues of over £900million.

a person standing next to a car: Addison Lee is a London based private cab hire and courier company. It was launched in 1975 by British businessman John Griffin © Provided by Daily Mail Addison Lee is a London based private cab hire and courier company. It was launched in 1975 by British businessman John Griffin

In 2019 the company teamed up with car hire group SIXT to provide ride-hailing services. It also provides its own through the Addison Lee app.

Read more

Fears of taxi fare price hike amid petrol crisis .
Taxi passengers are bracing themselves for a financial hit as the petrol crisis saw demand soar amid warnings of expensive fares. The Free Now cab company said they had been deluged by customers over the weekend, while the fuel chaos continued.And it came as one Uber worker warned prices could be high as it was difficult to get petrol to power the cars.Driver Tommy Hopper said online: 'I'm an Uber driver and unable to work because I can't get petrol,'Ubers will be very expensive this morning due to the lack of drivers.'A lot of our cars are hybrid but they still need petrol, the petrol engine charges the battery.

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