Uber has made headlines all year for one trauma or another, and today was no exception. The issue this time? Uber just lost its ability to operate in London.
Technically, it hasn’t lost the ability to operate yet—its license expires September 30. Uber will probably file an appeal against the Transport for London decision to refuse it a license. While Uber probably has a legal battle ahead, drivers probably don’t need to worry just yet.
Uber London currently has 4.5 million riders and some 40,000 drivers. Assuming the ban stays in place, the government may well have to answer to the public for those 40,000 jobs.
What happened to Uber London?
Uber’s original license to operate was granted in 2012, when the Olympics came to London. As with most licenses of its kind, the license was for five years, meaning it expired earlier this year.
At that point, Uber received a rare four-month extension on its license.
Transport for London, which issues the licenses, said Uber was not “fit and proper” to operate in the city. They had four main concerns.
- Criminal offenses.
- Obtainment practices for driver medical certificates.
- Background check procedure.
- Use of “Greyball” software to evade authorities.
Now what?
Uber is expected to file an appeal, which will allow it to keep operating in London while the legal process plays out. This is good news for drivers, since the process—and any consequences of it—is unlikely to be solved in the next few months to a year.
On top of the appeal process, there’s likely to be a lot of lobbying. Taxi cab drivers in London have been lobbying against Uber for nearly all of the company’s time in London. Uber London General Manager said the ban essentially means that Transport for London “caved” to this group of lobbyists.
Since news of the ban came out, hundreds of thousands have also been signing the petition in favor of keeping Uber London.
Should the ban worry drivers?
Probably not—at least not yet. Uber has a precedent of getting tossed out of a city only to return when they make a deal or convince lawmakers to change policy. It’s even managed to get Transport for London to loosen requirements before.
“Uber…will not even feel this,” Rich Pleeth, former chief marketing officer for Uber competitor Gett, told Quartz. Uber legal staff and lobbyists will work through the appeals process just like they have in other situations, he said.
However, Transport for London does have the support of London Mayor Sadiq Khan.
Perhaps more powerful than the Mayor, however, is the fact that Uber London has public opinion on its side. Cab services in London start at around $3.50 per ride. These rides are famously expensive, especially when compared to Uber rates.
The public has also taken to social media, specifically Twitter, to express its thoughts about the decision. While reviews are mixed, general opinion seems to be in Uber’s favor.
Will Uber ever go public?
The one thing this decision may do to Uber is shake public faith in the company. Such a blow would hurt Uber’s chances to go public under new CEO Dara Khosrowshahi. A change from a private to public company could possibly increase driver rates, although opinions are mixed.
Going public as a company has been a long time goal that Uber has been unable to reach.
