Posted by Michael Andersen (Contributor) on September 16th, 2014 at 9:19 am
Portland is now one of just two major U.S. cities where you can’t hail a ride with either Uber or Lyft — and that’s something the car-summoning companies would, of course, love to change.
The services essentially let anyone who passes their background checks become a paid cab driver using a personal car. But Uber has balked at expanding illegally into Portland, where you can be thrown in jail for six months for operating an unlicensed taxi.
We’ve been watching these trends closely because services like Uber are already having a huge impact on low-car life in other cities. Last week, I met a young Chicagoan who gets around by bicycle in nice weather but said she’s spent $2,000 on Uber this year for foul-weather commuting and late-night rides home; two years ago, she probably would have bought her own car by now and started using it for most trips.
Local media coverage of Uber has stuck with the basics: will they or won’t they? But we’d rather find a solution, so we sat down with two experts to explore the downsides, risks, complications and benefits of this rapidly spreading but controversial new service.
“I think the future is removing people out of their personal vehicles.”
— Brooke Steiger, Uber
Today’s Q&A is with Uber’s Seattle-based general manager for Washington state, Brooke Steiger, who talked with us last month about the ways Uber could fit into a low-car city and her answers to some of the complaints of Uber’s critics.
Tomorrow, we’ll be following up with a similar conversation with one of Uber’s loudest critics: the general manager of Portland-based Radio Cab.
Why would a company that makes it easier to travel by car be part of a low-car transportation network?
I think the future is removing people out of their personal vehicles. Providing more options to people will encourage that behavior. Options like Uber and bike share and public transportation feed into this huge option. I really see the future as options like Uber and no personal vehicles.
No personal vehicles?
Limited personal vehicle usage in the day-to-day.
I assume that eventually, Uber’s dream would be to get rid of the driver, too.
Obviously there are companies out there exploring driverless cars. There is new innovation coming out every single day.
This summer you reached a big compromise in Seattle over the amount of insurance Uber provides to its drivers if they hit somebody while they’re using the app.
We do carry $1 million when the driver is engaged in a trip. That covers anything from external property damage to, God forbid, if someone is hurt.
A different period is when you’re logged into the app. [But not driving someone.] In Seattle, we currently have $100,000 in contingent coverage during that period, and we will be raising that to $300,000. That means in the event that the driver’s insurance doesn’t cover, then our coverage will kick in.
But you say that’s a short-term deal and you’re lobbying Washington state for a different insurance requirement. What requirement are you hoping for long-term?
In Colorado, the requirement is to have $1 million while engaged in a trip and $100,000 in contingent coverage when you’re logged into the app.
Wouldn’t Uber lead to distracted driving? The only way you can be an Uber driver is to be looking at your phone while you’re behind the wheel, right?
The very simple thing is you mount your phone on the dash. What happens when a request comes in is the phone beeps. So you don’t have to look at the phone. And you can touch any point on the screen to accept it. It’s simpler than changing your radio station.
“You don’t have to look at the phone. And you can touch any point on the screen to accept it. It’s simpler than changing your radio station.”
— Brooke Steiger, Uber
Why do we need Uber? What’s wrong with the current taxi system?
Uber brings an extreme amount of accessibility for the rider. It just provides this extra level of safety that is really unmatched. And from the driver level, it provides a level of opportunity that they love.
In any city that we enter, the city sees so many benefits that I think it’s something that Portland should look into. It’s pretty phenomenal to see the reduction of DUIs. It’s taking people off the road.
I also remember seeing a headline that Uber was trying to cut prices so low that using UberX, your peer-to-peer taxi service, is cheaper than owning a car.
It was a 25 percent price cut, in January.
Our first product was Uber Black [a towncar summoning service]. There were so many towncars that have downtime. It really helped these small businesses succeed. It was also the idea of being able to get a very, very nice ride on demand.
We had a huge interest in both a greener option and a more cost-effective option. UberX seeemed to be a perfect option for that. And we also want to encourage people to get rid of their vehicle. Providing an affordable alternative was essential.
One of the most important taxi regulations is that they have to accept every trip request. Uber drivers don’t. So what’s to stop your drivers from rejecting an East Portland grandma’s 5-minute trip to the grocery store, because it’s not going to be profitable enough?
If a request comes in, they’re not required to accept that request. However, when you get the request, you have 10 seconds to accept. You don’t know where that person is going. They won’t know how much money that trip is worth. I think that’s why the taxi regulations are in place.
We provide thousands and thousands of minimum and short trips a day. We’ve had no issues at all with people not taking those short trips.
But the driver could still deny the ride based on the location of the trip, right?
We’re always trying to meet all that demand that we see. So if we see that there is demand in an area of town that there typically aren’t cars available in, then that’s something that we communicate to drivers as well. In Seattle, we actively messaged drivers that there were rides in Bellevue that weren’t being accepted, and the supply built up.
Qs & As edited for brevity and clarity. Watch this space tomorrow for our Q&A with Steve Entler, general manager of Radio Cab, Portland’s largest taxi company.