What the Uber files tell us about mobility
For many years now, we here at Mpact have of course been following the revelations about Uber, topped off this year by the “Uber files”. While most articles about the Uber files focused on the business model, the lobbying practices, or the legal aspects, relatively few talked about the implications for the (shared) mobility sector, or mobility itself for that matter. At Mpact, our intention is to make mobility more inclusive and more sustainable. That’s why we want to have a look at the Uber files through a mobility perspective.
Mobility is as diverse and multi-faceted as our societies. There is no one correct way to organise mobility in our regions and cities, many approaches have to be combined to offer everyone the possibility to move around comfortably, affordably and as sustainably as possible. This leads to one of our core beliefs at Mpact: mobility is a fundamental right. Equal access to it could be called a basic human need that deserves protection.
To make that a reality however, the diversity of offers needs adequate attention from public authorities, politicians, and the media. Now that the hype over Uber and other startups is over – we’d suggest taking a step back, to reflect and refocus the debate on the central question: what actually makes mobility better for everyone? This aspect seems to be missing from the many analyses and comments on the Uber Files, but for us as a mobility non-profit, it is what ultimately matters. Let’s have a look at some aspects of the Uber story to underscore our argument.
In this diverse world, for-profit mobility providers certainly have their place. However, we believe they cannot cover all our mobility needs and should be a piece of a larger puzzle. To illustrate this, let’s have a look at where they operate. Driven by market forces, private companies will only choose places where they can expect to be profitable. In Belgium, Uber for instance is operating in five cities only. Commercial car sharing operators define zones in cities where their cars are available, excluding parts of the city and of the population from access to their service. Unsurprisingly, these active zones almost always exclude the ‘bad’ and poor neighbourhoods. Not all operators do this, but the market logic definitely fuels the exclusion.
It’s also important to understand the financial side of things. The prices that for-profit operators charge are determined by their balance sheet, their investors’ expectations and their growth strategy. Remember the early days when it was so astonishingly cheap to take an Uber compared to a taxi? That’s because Uber was burning through billions of dollars of venture capital each year to be able to offer lower prices than taxis, its main competitor. Once this competition had been priced out of the market, Uber began raising its rates while reducing pay for drivers, in order to hopefully start making a profit. While taking an Uber may, in some places, still be somewhat cheaper than traditional taxis, the truth is that by now it’s affordable mostly to users from middle- or high-income households.
In addition to geographical factors and income, Uber is being used overwhelmingly by younger people. In the US, only 6% of its users are over the age of 55. While in Germany, 94% of over-55s have never used Uber even once.
A purely market- and profit-based mobility system therefore would provide no guarantee to include the entire population regardless of place, age, and income. That’s why we need public transportation in the first place. Governments rightly invest large sums of money into metros, trams, buses, and trains, as well as their operation. Public transport gets hundreds of thousands of people across large cities day in, day out, reliably.
But public transport is not perfect, either. In rural areas especially, coverage is often minimal. Public authorities also have limited resources and cannot build expensive infrastructure in places without enough density and potential users. In general, no matter the place, building public transport infrastructure is costly and slow.
So what to do when neither for-profit mobility operators nor public transport are an option in a given place or for a group of people? That’s where non-profit private operators – such as Mpact – come in to help people cover their mobility needs. We can provide creative solutions that neither have to be hugely profitable nor require enormous investments.
So in the end, mobility businesses will come and go, because it is a sector that is profitable and very ‘hot’. But sometimes we should take a step back and look at the mobility problem for which these businesses are providing a solution. Because some of them might not even be answering a particular mobility problem, and might instead be moving us away from a future of doing more with less.
– Written by Karsten Marhold and Isaura Lips